SOYBEANS EASE FURTHER FROM 6-1/2 YEAR TOP; CORN, WHEAT ALSO LOWER
Chicago soybean futures fell for a second session on Friday as a slowdown in U.S grain exports and broad losses in financial markets encouraged soy prices to ease from a 6-1/2 year high. Corn and wheat also dropped for a second day in the wake of Thursday’s lower than expected weekly U.S. export sales, which tempered concern about tightening global supply that have fuelled multi-year highs in Chicago grains in the past month.
The U.S. Department of Agriculture (USDA) said on Thursday that weekly export sales of soybeans totalled 238,700 tonnes, the smallest volume since the week ended Dec. 31. In cereals, the USDA reported an eight-month low for weekly U.S. corn export sales and the lowest wheat tally in over a year.
Although analysts said the drop-off in exports may be partly due to the recent Lunar New Year holiday in China, the data raised the idea of high prices curbing demand. “Is this (price) movement a one-off or a more sustainable trend caused by lower demand?” wondered consultancy Agritel. “A confirmation of these (export) figures will be needed next week.” The most-active soybean contract on the Chicago Board Of Trade was down 1.3% at $13.89-1/4 a bushel by 1109 GMT, as it retreated further from Thursday’s peak of $14.45-3/4, a level not seen since June 2014.
CBOT corn was down 1.3% at $5.42-3/4, while wheat was 1.7% lower at $6.64. Soybeans are set to end February with a ninth consecutive monthly gain, against a backdrop of dwindling U.S. stocks and a rain-slowed Brazilian harvest that have raised uncertainty about availability to meet strong Chinese demand. But in China, soybean crushers are expected to curb activity due to Brazilian harvest delays, while fresh outbreaks of African swine fever have created concern about feed demand. Many analysts and traders still see global supply tensions supporting grain prices.
“There is a bit of profit-taking, but overall we are still bullish, especially for soybeans and corn,” said Ole Houe, director of advisory services at brokerage IKON Commodities. “We are just about to enter the critical March-May planting season in the Northern Hemisphere, so there is plenty of risk ahead.”
Prices at 1109 GMT Last Change Pct End Ytd Pct Move 2020 Move CBOT wheat 664.00 -11.75 -1.74 640.50 3.67 CBOT corn 542.75 -7.00 -1.27 484.00 12.14 CBOT soy 1389.25 -18.25 -1.30 1311.00 5.97 Paris wheat Mar 243.75 -2.00 -0.81 213.25 14.30 Paris maize Mar 227.75 -1.50 -0.65 198.50 14.74 Paris rape May 482.25 -6.00 -1.23 412.00 17.05 WTI crude oil 63.06 -0.47 -0.74 48.52 29.97 Euro/dlr 1.21 -0.01 -0.50 1.2100 0.12 Most active contracts – Wheat, corn and soy US cents/bushel, Paris futures in euros per tonne
Source: Reuters (Reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore. Editing by Vinay Dwivedi and Mark Potter)