U.S. agricultural futures close mixed

By Xu Jing

CHICAGO, Jan. 27 (Xinhua) -- Chicago Board of Trade (CBOT) agricultural futures closed mixed on Wednesday, with corn and soybean rising and wheat dropping.

The most active corn contract for March delivery rose 1.75 cents, or 0.33 percent, to settle at 5.34 U.S. dollars per bushel. March wheat lost 7 cents, or 1.05 percent, to settle at 6.5825 dollars per bushel. March soybean gained 4.5 cents, or 0.33 percent, to close at 13.7475 dollars per bushel.

CBOT corn and soybean went higher on new U.S. sale to China, while wheat sagged on intercrop spreading. Traders were using wheat as their short leg against long corn/soybeans amid building market volatility, Chicago-based research company AgResource noted.

U.S. Department of Agriculture (USDA) announced the sale of another 680,000 metric tons of corn to China, along with 126,500 metric tons of U.S. soybeans to an unknown destination, believed to be China, further along with 132,000 metric tons of 2021-2022 soybeans to China.

The United States has sold 2.04 million metric tons of corn to China in the past 2 days, which will raise U.S. corn 2020-2021 export commitments to a record large 1,975 million bushels. U.S. soybean sales will also be record large at 2,150 million bushels with U.S. exporters already shipping out 76 percent of this total.

Generally, U.S. farmers have sold an estimated 90 percent plus of their 2020 soybean and 80 percent to 85 percent of their corn crops.

Energy Information Administration (EIA) reported that weekly U.S. ethanol production fell 1.3 percent to 274 million gallons from the previous week, which consumed an estimated 95 million bushels of corn. U.S. ethanol stocks held steady at 991 million gallons. AgResource deemed the weekly report positive.

Weather forecast shows soaking regular rain is to drop across the southern one-third area of Brazil. The rain will cause crop quality issues and low-level flooding. Eastern Central Brazil will hold in an arid flow while near to below normal rains will drop across Northern Brazil. Weather forecast for Argentine offers near to above normal rainfall, which will aid crops. The cool/wet weather slows maturation and heightens the spread of fungal diseases.

China is buying U.S. corn and additional U.S. corn purchases are likely as China slows its weekly wheat auctions and domestic feed prices rise. Meanwhile, China will continue to book old crop U.S. soybeans amid excessive wet weather in Brazil. AgResource holds that breaks will be brief and shallow.

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