U.S. grains: Soybeans hit four-month high on hot, dry weather

CBOT corn futures near 3-1/2-month peak

CBOT November 2020 soybeans with 20-, 50- and 100-day moving averages. (Barchart)

Chicago | Reuters — U.S. corn and soybean futures rose on Monday as expectations for unfavourably hot, dry weather increased concerns over the crops, after the federal government said last week that U.S. farmers planted fewer acres than expected.

Soybeans touched a four-month high and corn traded near last week’s 3-1/2-month peak as the markets also drew support from demand from China.

In the United States, traders worried the weather could threaten yields as corn enters an important stage of crop development.

“An oppressive Midwest weather pattern lingers,” said Matt Zeller, a market analyst for broker StoneX.

The most actively traded CBOT soybean futures settled 9-1/2 cents higher at $9.06-1/4 a bushel after touching their highest price since March 5 (all figures US$). Most-active corn rose 2-3/4 cents to $3.56-1/4 per bushel, while soft red winter wheat advanced 1-1/4 cents to $4.93-1/4 per bushel.

The U.S. Department of Agriculture on Monday reported that exporters struck deals to sell 264,000 tonnes of old-crop U.S. soybeans and 202,000 tonnes of new-crop U.S. corn to China. The agency also reported 182,880 tonnes of U.S. corn were sold to Mexico for shipment in the 2020/21 and 2021/22 marketing years.

USDA, in a separate report after the markets closed, said 71 per cent of the country’s corn crop was in good-to-excellent condition, down two percentage points from a week ago. Analysts surveyed by Reuters on average had expected a decline of one percentage point.

The agency rated 71 per cent of the U.S. soybean crop in good-to-excellent condition, unchanged from the previous week. Analysts surveyed by Reuters on average had expected a 1-point decline.

“Traders will continue to remain focused on weather maps this week as they try to decide how much weather premium should be added to these markets,” brokerage Allendale said.

Traders on Tuesday will also look for the results of an Egyptian tender for wheat.

Reporting for Reuters by Tom Polansek in Chicago, Gus Trompiz in Paris and Colin Packham in Sydney.

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