Chicago | Reuters – Chicago Board of Trade wheat futures extended losses for a third session on Tuesday, slumping to fresh lows as the most-active contract hovered near prices not seen since late October, while bumper harvests in Argentina and Australia underscored hefty global supplies.
The Rosario Grains Exchange last week raised its production estimate for Argentina to 27.7 million metric tons from 24.5 million tons. Australia is on track for its third-biggest harvest.
Progress in talks to end Russia’s war in Ukraine also hung over grain markets, analysts said. Ukraine is a major corn and wheat exporter.
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The most-active March wheat contract on the Chicago Board of Trade Wv1 fell by 11-1/4 cents to $5.09-1/2 after touching its lowest since October 23 at $5.07-1/2.
Weakness in the wheat market spilled over into corn futures, amid ongoing concern that cheaper wheat supplies could eat into demand for corn as a livestock feed, traders said.
Soybeans dropped to a new seven-week low due to concerns about U.S. export demand and expectations for a bumper harvest in Brazil. Traders have been disappointed at the pace of Chinese purchases of U.S. soybeans since this fall’s trade talks between Washington and Beijing.
March CBOT corn eased by 3-1/4 cents to $4.36-1/2 a bushel after falling to a three-week low on Monday, and January soybeans fell 9 cents to at $10.62-3/4 a bushel.
Weakness in the energy markets also cast a pall over soy markets, market analysts said. Oil prices fell below $60 a barrel on Tuesday, the lowest since May, as prospects for a Russia-Ukraine peace deal appeared to strengthen, raising expectations sanctions could be eased.
U.S. domestic crushing of soybeans slowed more than expected in November but was still a record high for the month, according to the National Oilseed Processors Association.
“For soybeans, it’s all about energy and China fatigue,” said Don Roose, president of U.S. commodities in West Des Moines, Iowa. “The premium that had been in place in the soybean market with the U.S.-China talks is just being sucked out right now.”
-Additional reporting by Peter Hobson in Canberra and Gus Trompiz in Paris
