Chicago | Reuters — U.S. soybean futures closed higher on Wednesday on technical buying and uncertainty about U.S. yield prospects, analysts said.
Corn and wheat futures also firmed, steadying after the benchmark contracts for both grains dipped to three-month lows.
Chicago Board of Trade November soybean futures settled up 4-3/4 cents at $8.73 per bushel (all figures US$). December corn ended up 1-1/2 cents at $3.70-1/4 a bushel, after falling to $3.66-1/4, the contract’s lowest since mid-May.
December wheat finished up 1-1/2 cents at $4.68 after touching $4.61-3/4, its lowest since May 14.
Soybean futures drew support from this week’s annual Pro Farmer Midwest Crop Tour, which found below-average soybean pod counts in both Nebraska and Indiana, an indication of subpar production prospects.
The crop tour wraps up in Minnesota on Thursday, and editors of the Pro Farmer newsletter are expected to release U.S. soy and corn production estimates the following day.
Also bullish were outlooks for cooler-than-normal temperatures in the U.S. Midwest that could slow the development of the U.S. corn and soybean crops, which are already late because of widespread spring planting delays.
“There are a few (weather) maps coming out that had (temperatures) 10 to 15 F below normal for that first week of September, which is not going to kill the crop. But the crop does need growing degree days, and that doesn’t bode well,” said Matt Connelly, analyst with the Hightower Report in Chicago.
Corn futures got a boost after the U.S. Department of Agriculture said private exporters sold 328,000 tonnes of U.S. corn to Mexico for delivery in the 2019-20 marketing year that begins on Sept. 1.
But worries about demand for corn-based ethanol hung over the market. The nation’s largest ethanol producer, POET, said on Tuesday it was cutting production at its plants, blaming President Donald Trump’s administration over the relief he has given oil refiners from rules requiring use of biofuels.
“That gave corn a kick in the teeth yesterday. Demand destruction in corn, with ethanol or exports, has been the driver,” Connelly said.
The U.S. Energy Information Administration said U.S. output of corn-based ethanol fell to 1.023 million barrels per day in the week to Aug. 16, the smallest since April, while stocks fell to 23.37 million barrels.
— Reporting for Reuters by Julie Ingwersen; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.