Wheat, corn and soybean prices all continued to decline in Chicago on Thursday ahead of the US presidential election and concerns over demand levels.
Corn fell 0.75% after performing well for most of the month. "There have been some profit taking but also concerns about ethanol", the demand for which could be reduced if the Covid-19 epidemic accelerates the taking of health restriction measures in the United States. A significant portion of US corn production is used in the manufacture of ethanol, which is used as a biofuel.
The intensification of the pandemic around the world and the new strict measures in several European countries are therefore weighing heavily on investor morale. Under these conditions, a huge export order of more than 1.4 million tonnes of corn from Mexico, announced by the US Department of Agriculture, has not even helped to recover prices. Mexican buyers "seized the advantage" of the fall in the price to fulfill this order. The sale of 1.433 million tons of US corn comes after Mexico's most productive farmers said they may not be able to keep up with growing demand following cuts in state funding and warned of a growing dependence on imports.
The USDA said 891,540 tons of corn were reserved for delivery in the current 2020/21 business year ending Aug. 31 and scheduled to ship in 2021/22.
The so-called flash sale was the largest for the largest U.S. corn buyer since December 12, 2019, when a deal for 1.6 million tonnes was announced.
The price of wheat, down 0.82%, was also influenced by recent rains in the American plains, which benefits harvests. In the absence of Chinese orders, soybeans also fell to a lesser extent (- 0.52%).
The bushel of wheat (about 27 kg) for delivery in December, ended at 6.0375 dollars against 6.0875 dollars on Wednesday, down 0.82%. The most traded bushel of corn (about 25 kg) for delivery in December ended at $ 3.9850 from $ 4.0150 on Wednesday, down 0.75%. The most traded bushel of soybeans (around 27 kg) for November delivery closed at $ 10.5175 from $ 10.5725 the day before, down 0.52%.