Wheat futures declined, set for the first weekly loss in three, on speculation the U.S. Department of Agriculture may lower next week its estimate for the nation’s exports this season. March-delivery wheat dropped as much as 1.1 percent to $7.8075 a bushel on the Chicago Board of Trade. It traded at $7.81 a bushel at 2:32 p.m. Singapore time, set for a 1.7 percent loss this week. Futures surged 15 percent last month, ending the year 47 percent higher, as floods in Australia curbed supply of milling wheat. Exporters in the U.S., the world’s largest shipper, sold 464,700 metric tons of the grain in the week ended Dec. 30, down 22 percent from the average in the past four weeks, the U.S. Department of Agriculture said yesterday. “Eyes are on, at this present stage, the next USDA report, which will most likely show reduced estimates of U.S. wheat exports,” Luke Mathews, a commodity strategist at Commonwealth Bank of Australia, said by phone from Sydney today. The USDA had kept its exports forecast for the nation this marketing year unchanged at 34 million tons in December from a month earlier. That’s 41 percent higher than last year’s shipments. As of Dec. 30, wheat for export inspected at U.S. ports since the marketing year started June 1 gained 32 percent, from a year earlier, the USDA said Jan. 4. The next USDA estimate on wheat exports is due on Jan. 12. Export Target “For the U.S. to achieve their target previously put in place, weekly export inspections need to be running significantly higher,” Mathews said. “We expect downward revisions.” India, the second-biggest wheat grower, may harvest a record crop for a fourth year as favorable weather and lucrative government prices encourage farmers to increase plantings. The harvest may meet the target of 82 million tons in the year ending June 30, from 80.71 million tons last year, Farm Secretary P.K. Basu said in an interview yesterday. Output was 80.68 million tons in 2008-2009 and 78.57 million tons in 2007-2008, the farm ministry data show. March-delivery corn lost as much as 1 percent to $5.9625 a bushel on the Chicago Board of Trade. It traded at $5.9875 a bushel at 2:23 p.m. Singapore time, set for a 4.8 percent loss this week. Futures jumped 16 percent in December to end the year with the biggest annual advance in four years, on concern dry weather in South America may widen a global production deficit. Investors may be cashing in from last month’s surge in corn futures ahead of the USDA report on agricultural supply and demand, Mathews said. “The speculative community has quite a significant net-long position and there’s a potential for some profit-taking to be put in place,” he said. The corn harvest in Argentina, the world’s second-largest exporter, may drop to 20.4 million tons this season, from 22.5 million tons a year earlier, as a drought hurts the crop, the Buenos Aires Cereals Exchange said yesterday. The USDA forecast on Dec. 10 that Argentina’s harvest will rise to 25 million tons this season. Soybeans for March delivery slipped 0.6 percent to $13.695 a bushel, taking the weekly loss to 2.4 percent. To contact the reporter on this story: Luzi Ann Javier in Singapore at ljavier@bloomberg.net To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net

Source