U.S. grains: Soybeans fall from peak on weak cash market

(Scott Bauer photo courtesy ARS/USDA)

Chicago | Reuters — U.S. soybean futures fell for the first time in four sessions on Tuesday, pressured by a weak cash market and by profit-taking after hitting a 3-1/2-week high earlier in the session, traders said.

Corn futures eased in a mild technical setback but remained within the prior session’s trading range. Wheat dropped on profit-taking after adding gaining seven per cent over the previous three sessions.

Chicago Board of Trade November soybeans ended down 5-3/4 cents, or 0.6 per cent, at $9.72-1/2 per bushel (all figures US$).

The contract climbed above its 200-day moving average earlier in the day and reached a high of $9.87, but closed near its session low as the rally triggered active farmer sales in the cash market.

Soybeans drew early support from the U.S. Department of Agriculture’s confirmation of private sales 706,500 tonnes of U.S. soybeans to China.

The sales announcement followed a visit to Iowa last week by a delegation of Chinese soy buyers who signed purchase agreements to buy 5.1 million tonnes of U.S. soybeans.

A larger-than-expected monthly soy crush figure released Monday by the National Oilseed Processors Association also fuelled early gains, said Mike Zuzolo of Global Commodity Analytics.

The figure signaled strong demand for soymeal, a feed ingredient, despite competition from distillers’ dried grains (DDGs), a byproduct of corn-based ethanol production.

China last month imposed anti-dumping duties on DDGs, a move that some feared would push the ingredient back into U.S. feed channels and stifle demand for soymeal. But NOPA’s crush figure indicated otherwise.

Early gains in corn, fueled by concerns that the U.S. harvest was behind the normal pace, eroded on technical selling.

CBOT December corn shed 1/4 cent to $3.53-3/4 a bushel, failing for a third session to break through chart resistance at its 100-day moving average.

USDA said the U.S. corn harvest was 46 per cent complete by Sunday, behind the five-year average of 49 per cent and lagging trade expectations.

“Corn bounced a little bit, probably due to some rain moving into the eastern Corn Belt this week that might slow harvest activity,” said Terry Reilly, analyst with Futures International.

Wheat retreated, with the December contract easing 3-3/4 cents to $4.20 a bushel following a three-session climb that analysts attributed to funds covering short positions.

— Julie Ingwersen and Karl Plume report on grain markets for Reuters from Chicago. Additional reporting for Reuters by Sybille de La Hamaide in Paris and Naveen Thukral in Singapore.

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