Chicago | Reuters — Chicago soybean futures tumbled on Thursday as the prospect of downpours in Brazil helped offset concerns over hot, dry weather threatening crops in the top exporting nation.
Chicago Board of Trade (CBOT) corn ended slightly higher after early losses, while weak demand pushed wheat down 1.25 per cent as the market hit a two-week low in early trading.
The most-active soybean contract on the CBOT Sv1 finished down 1.8 per cent at $13.60-1/4 a bushel. The market extended a setback after the contract on Wednesday reached $13.98-1/2, its highest since Aug. 30, before closing lower.
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Soybeans have rallied since the middle of October, supported by drought conditions in northern and central Brazil. However, rains in the forecast next week have eased worries over how the weather in key planting areas could hurt production.
A large harvest in Brazil could limit global demand for U.S. soybeans, said Darin Fessler, a market strategist with Lakefront Futures.
“If Brazil does have a good crop, when we start looking at our… prices in January, February and on, we’re not all that competitive versus Brazil,” Fessler said, adding that any loss in crops in Brazil may be made up by an increase in production in Argentina.
Total weekly U.S. soybean export sales last week were the highest since 2012 at 3.9 million metric tons after a surge in buying from China, the largest importer of the oilseed. That was within analysts’ expectations.
The U.S. government separately reported private sales of 220,000 tons of U.S. soybeans to unknown destinations.
“There’s still a larger lingering cloud about how strong China’s economy is and do they really step back up into the buying of commodities,” Fessler said. “I think what we’ve seen recently and probably some goodwill offerings, maybe some hedging by the Chinese.”
CBOT December corn CZ3 settled up 4 cents at $4.74-3/4 per bushel. December soft red winter wheat WZ3 settled down 7 cents at $5.53-1/2 per bushel, after earlier touching its lowest price since Oct. 2.
Weekly U.S. export sales for 2023/24 were above a range of trade expectations for corn, while weekly wheat sales were below expectations.
–Reporting for Reuters by Brendan O’Brien. Additional reporting by Gus Trompiz in Paris and Peter Hobson in Canberra.
