U.S. grains: Soy firms modestly on export demand

(Scott Bauer photo courtesy ARS/USDA)

Chicago | Reuters — U.S. soybeans firmed on Thursday on signs of resurgent export demand but corn drifted lower in subdued trade as the market awaited key monthly reports due Friday from the U.S. Department of Agriculture.

Wheat fell despite better-than-expected weekly export sales data.

At the Chicago Board of Trade, November soybeans settled up 1-3/4 cents at $9.84 per bushel (all figures US$). December corn ended down 1-1/4 cents at $3.31-3/4 a bushel and September wheat fell 5-1/2 cents at $4.16-1/4 a bushel.

Soybeans rose after the USDA reported export sales of U.S. soybeans totalling more than three million tonnes in the week to Aug. 4, topping analysts’ expectations.

In addition, USDA confirmed sales in the last day of 129,000 tonnes of U.S. soybeans to unknown destinations and another 120,000 to China.

“We are seeing very good demand right now for exports, suggesting foreign buyers are seeing value at these prices,” said Ted Seifried, chief market strategist for Zaner Ag Hedge.

A more than four per cent jump in crude oil lent support to the commodities sector. The 19-market Thomson Reuters CoreCommodity CRB Index rose almost 1.4 per cent.

However, upside momentum was limited in grains trade as brokers positioned for the USDA’s monthly supply/demand reports, which will include the government’s first estimates of U.S. 2016 corn and soybean yield based on field surveys.

“This whole week has been quiet as we wait to see what this report has to say,” Seifried said.

Analysts surveyed by Reuters expect the government to raise its corn and soybean yield estimates, but increased export demand for soybeans could prompt USDA to trim its ending stocks forecasts.

Weather remains largely favourable, with rains crossing much of the Midwest this week as the corn crop fills kernels and soybeans set pods.

Wheat futures fell on technical selling and ample domestic and global supplies. The market shrugged as USDA reported weekly export sales of U.S. wheat above 600,000 tonnes, a five-week high that topped trade expectations.

Wheat traders will be watching on Friday for revisions to USDA’s world outlook in light of poor harvests in western Europe and bumper crops in the Black Sea region.

Strategie Grains on Thursday slashed its forecasts for European Union soft wheat production and exports this season as the analyst firm factored in a “disastrous” harvest in France where it sees weather-hit yields at a 29-year low.

— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Colin Packham in Sydney and Gus Trompiz in Paris.

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