Wheat extended two-day losses over the concerns that U.S. supplies are uncompetitive. Corn and soybeans fell after reports of large crop expectations in South America.
"U.S. wheat is looking expensive compared to alternative origins," said Tobin Gorey, agricultural commodities strategist, Commonwealth Bank of Australia.
Egypt, the world's largest buyer of wheat, said on Tuesday that it had bought 175,000 tonnes of wheat from Romania and Ukraine as it was cheaper than the $25 per tonne or more offered by U.S.
The prospects for U.S. wheat exports became a concern after the Egypt announcement.
Wheat is currently trading at 589.63 making nearly 3% losses in the past two days.
MT4 WHEAT CHART
China, the world's top buyer of soy, will raise imports by 4.5% in 2014/15 from the previous year, to 73.5 million tonnes after the Chinese chamber of commerce reported expectations of a decrease in demand from the animal feed industry.
According to the chamber’s data, China's soybean crushing industry, the largest in the world, made a loss of 28.51 billion yuan ($4.6 billion) in the first 10 months of 2014. Outbursts of bird flu early in the year as well as excessive imports by financial traders, hurt the profits of the industry’s major companies, including Wilmar International Ltd and China Agri-Industries, who suffered huge losses in Q1 of 2014.
In the first 10 months of the year, imports by financial traders, including Sunrise Group and Shandong Changhua Food Co. Ltd, reached a combined 12 million tonnes, 22% of total imports during the same period, as reported by the Chinese chamber of commerce.
Soybeans currently trading at 995.13, fall from 1020.02 on Tuesday.
MT4 SOYBEANS CHART
Corn currently trading at 368.0 with a drop from Tuesday’s 376.46
Analysts believe both corn and soybeans are falling because of the large crop expectations in Brazil and Argentina.
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