Chicago | Reuters — U.S. wheat futures dropped 2.9 per cent on Monday, their biggest daily sell-off in two weeks, with traders saying that Russia’s export tax plan was bearish for prices in the short term.
Soybean futures were firm, supported by a rising forecast for imports by top global producer Brazil, while corn edged higher.
Major wheat exporter Russia plans to impose an export tax of 25 euros (C$38.79) a tonne on wheat exports between Feb. 15 and June 30, the economy minister said on Monday. This is part of measures to stabilize domestic food prices.
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There were good gains for the Chicago soy complex during the week ended Feb. 4, due to positive news that Wednesday.
“So between now and Feb. 15, the belief is that the Russian exporter is going to do all he can… to ship out as much as he can,” said Don Roose, president of Iowa-based brokerage U.S. Commodities. “Russia is going to pump out port-capacity wheat.”
The expected flood of Russian supplies onto the market will likely chill overseas demand for U.S. wheat for the next two months, Roose added.
Chicago Board of Trade March soft red winter wheat settled down 18 cents at $5.96-1/2 a bushel (all figures US$).
The U.S. Agriculture Department on Monday morning said that weekly export inspections of wheat totaled 261,164 tonnes, below market expectations.
Chicago wheat rose sharply on Friday on expectations the Russian tax would likely to increase global demand for U.S. and other supplies.
“It seems to be something of a classic example of buy the rumor and sell the fact, with profit-taking after wheat reached three-week highs,” said Matt Ammermann, StoneX commodity risk manager.
CBOT January soybeans ended nine cents higher at $11.69-1/2 a bushel.
Brazil will likely import 800,000 tonnes of soybeans in 2021, oilseeds crushers’ association Abiove told a news conference on Monday. The group’s previous forecast was for 500,000 tonnes.
CBOT March corn was 1/2 cent higher at $4.24.
— Reporting for Reuters by Mark Weinraub in Chicago; additional reporting by Michael Hogan in Hamburg and Colin Packham in Sydney.
