Chicago | Reuters — U.S. soybean futures extended their rally on Thursday, rising 1.7 per cent to set a two-year high as brisk demand from China continued to support the oilseed market.
Corn rose as the strength in soybeans overshadowed pressure from a smaller-than-expected Chinese corn import quota. Wheat futures jumped on technical buying and firming global cash prices.
Chicago Board of Trade November soybean futures settled up 17-1/4 cents at $10.28-1/2 per bushel after reaching $10.32-1/4, a life-of-contract top and the highest price for a most-active soybean contract on a continuous chart since May 2018 (all figures US$).
CBOT December corn ended up 3-1/2 cents at $3.75-1/4 a bushel and December wheat rose 14-1/4 cents to settle at $5.56-1/4 a bushel.
Soybeans led the move higher, fueled by persistent Chinese demand. The U.S. Department of Agriculture has announced U.S. soy sales to China in each of the past 10 business days, including Thursday’s confirmation of 264,000 tonnes, along with an additional 360,500 tonnes sold to unknown destinations.
“Until we see our Chinese friends relenting, that is the issue everybody will be looking at,” said Dan Basse, president of AgResource Co in Chicago. “When they finish (buying) is anybody’s guess,” Basse said.
Corn futures briefly dipped lower, pressured after China set its tariff rate quota for corn, wheat and rice imports in calendar year 2021 at the same volumes as previous years. Some traders had expected a larger corn import quota in light of a flurry of recent Chinese corn purchases.
Others downplayed the market impact of the quotas.
“If they (China) need to buy an extra 10 million tonnes of corn, they will make the changes on their quota and you will know after the fact… So it’s kind of meaningless,” said Terry Linn, analyst with Linn + Associates in Chicago.
Wheat futures climbed on signs of rising global cash prices. Egypt’s main state wheat buyer on Wednesday booked 235,000 tonnes of Russian and Polish-origin wheat at prices that were $8-$10 per tonne higher than those paid at Egypt’s previous international tender on Sept. 3.
— Reporting for Reuters by Julie Ingwersen in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.