Chicago | Reuters –– U.S. soybeans rose to a three-week high on Tuesday, underpinned by a U.S. Department of Agriculture report showing a slight deterioration in crop ratings that could result in lower yields.
Wheat and corn declined at the Chicago Board of Trade (CBOT) in relatively thin volumes in all three commodities, with many investors awaiting a possible interest rate hike on Thursday by the Federal Reserve.
USDA, in a report after the close of trading on Monday, cut good-to-excellent condition ratings for the U.S. soybean crop by two percentage points, compared with a one-point reduction expected by analysts.
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The soybean crop, which will be harvested in the coming weeks, was rated 61 per cent good to excellent, down from 63 per cent a week ago and 72 per cent a year earlier.
“The crop condition reactions kicked off (the soybean rally), but it’s really slow,” said Terry Reilly, analyst at Futures International. “People are waiting to see what the Fed says later this week, which will impact commodity prices.”
CBOT November soybeans settled up 4-3/4 cents at $8.89 per bushel, near the highest since Aug. 21 (all figures US$).
Corn edged down after hitting a one-month high on expectations of lower U.S. output because of wet growing conditions, while wheat fell after three sessions of gains, a rally seen as overdone as global supplies remain plentiful.
CBOT December corn eased three cents, to $3.90-1/2 per bushel, declining for the first time in seven sessions and snapping the longest streak of higher prices in 11 months.
CBOT December wheat was down 6-1/2 cents to $4.94-1/4 per bushel, after hitting $5.03-1/4 earlier in the session, its strongest since Aug. 26.
“There is a feeling the rise (in wheat) may have been overdone. It was mainly supported by short covering, not fundamentals. The USDA raised its stock levels in wheat,” a European trader said, stressing that the contract had fallen below the psychological level of $5 per bushel.
— Michael Hirtzer reports on agriculture and ag commodity markets for Reuters from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Sybille de La Hamaide in Paris.
