U.S. grains: Soybeans near 14-month low as weather worries recede

(Scott Bauer photo courtesy ARS/USDA)

Chicago | Reuters — U.S. soybean futures fell to their lowest level in nearly 14 months on Tuesday on better-than-expected weather conditions over a long holiday weekend and worries about export demand for new-crop supplies, analysts said.

Corn and wheat futures declined about two per cent on improving U.S. weather outlooks.

Chicago Board of Trade July soybeans settled down 13-3/4 cents at $9.12-3/4 per bushel after dipping to $9.10-1/2, the lowest level for a most-active soy contract since early April 2016 (all figures US$).

CBOT July corn ended down 7-1/4 cents at $3.67 per bushel and July wheat fell 8-3/4 cents to $4.29-1/2 a bushel.

Soybeans fell as showers in the eastern U.S. Midwest over the Memorial Day weekend were not as heavy as some had feared, and forecasts called for improving weather following excessive rains earlier this month.

“This week we have got a rain event coming through, but next week some folks are trying to say it’s going to be clearer and warmer,” said Tom Fritz, a partner with EFG Group in Chicago.

Talk of poor crush margins in China, the world’s top soybean buyer, raised concerns about export demand for U.S. soy, although the U.S. Department of Agriculture said private exporters sold 130,000 tonnes of old-crop U.S. soybeans to unknown destinations.

Brazil’s recently completed, record-large harvest may crimp export demand for the soybeans that U.S. farmers are planting now.

“The South Americans are going to compete with us for longer than what some people think,” said Jim Gerlach, president of A/C Trading.

Corn fell on improved weather outlooks, with the CBOT July contract hitting its lowest level since May 19. But traders were awaiting direction from USDA’s first weekly corn condition ratings of the season.

After the CBOT close, USDA rated 65 per cent of the corn crop in good to excellent condition, below an average of analyst expectations for 68 per cent.

USDA also rated 50 per cent of the U.S. winter wheat crop and 62 per cent of the spring wheat as good to excellent. Both wheat figures fell below analyst expectations.

Also after the close, Egypt’s General Authority for Supply Commodities (GASC) said it was seeking wheat from global suppliers for shipment from July 1-10.

At its last tender on May 17, GASC made its first purchase of U.S. wheat in more than two years.

— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Michael Hogan in Hamburg and Naveen Thukral in Singapore.

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