Chicago | Reuters — Chicago wheat dropped for a second day on Friday, moving further from a 3-1/2 month high reached this week as a stronger dollar made U.S. exports look less attractive.
Corn futures also eased for a second session following a three-month peak this week, and soybeans headed downward with technical trading and the rally in the dollar at play, analysts said.
Stronger-than-expected U.S. jobs data for September spurred the dollar to jump to a seven-week high. A stronger dollar tends to make U.S. exports less competitive on the global market.
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U.S. wheat futures closed higher on Thursday on concerns over the limited availability of supplies for export in Russia, analysts said.
The most active Dec wheat contract on the Chicago Board of Trade was down 13-3/4 cents at $5.89-3/4 a bushel, after reaching its highest point since mid-June on Wednesday and Thursday.
The dollar’s rise comes at a bad time, Hightower Report analyst Randy Place said, because U.S. farmers are expected to harvest a record soy crop and the second biggest corn crop in history.
“A bump up in exports is kind of what we needed with the bumper harvest,” Place said.
CBOT Nov soybeans dipped 8-1/4 cents to $10.37-3/4 a bushel. CBOT Dec corn slipped 3-1/2 cents to $4.2475 a bushel.
Wheat’s losses were capped by ongoing concerns about dry weather in the Black Sea region, and the latest Russian attack on Ukrainian port infrastructure.
In soybeans, the start of the long-awaited monsoon season in Brazil is expected in the second half of the next week, said Place, after dryness delayed early soybean plantings in the world’s top soy exporter.
Prices of byproduct soymeal have also fallen since Wednesday, after the European Commission proposed delaying new anti-deforestation rules. The rules have recently boosted demand for U.S. soymeal over South American supplies, according to analysts.
“That takes a significant bullish thing away from the meal,” said Place, “which hurts the beans too.”
Corn, used to make ethanol, has found support in rising oil prices this week, though progress in harvesting the bumper U.S. crop capped prices.
Additional reporting for Reuters by Gus Trompiz in Paris and Peter Hobson in Canberra
