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Soybeans set for third day of gains on Chinese buying; wheat falls

Chicago soybeans rose for a third consecutive session on Wednesday, buoyed by China’s move to give waivers to buy some U.S. soybeans exempt from tariffs, but the ongoing trade war between the two countries kept gains in check.

Wheat slid for a fifth session, as abundant supplies from the Northern Hemisphere harvest weighed on the market.

The most-active soybean contract on the Chicago Board Of Trade was up 0.2% at $8.96 a bushel as of 0355 GMT, after closing 0.2% higher in the previous session.

Wheat slid 0.1% at $4.81-1/4 a bushel and corn added 0.5% at $3.76-3/4 a bushel.

“Chinese buying is supporting the market although it is just a short-term support as concerns remain about the trade war,” said Phin Ziebell, agribusiness economist, National Australia Bank.

China has given new waivers to several importers to buy U.S. soybeans exempt from retaliatory tariffs, in a goodwill gesture ahead of high-level trade talks next month, two sources familiar with the matter said.

The waivers, offered in two batches, totalled around 5 million to 6 million tonnes, according to one of the sources.

U.S. President Donald Trump sharply criticized China’s trade practices on Tuesday in an address at the U.N. General Assembly. Trump also held out hope that the two economic superpowers could reach a deal to end their trade dispute.

The Commodity Weather Group said a frost was possible late next week in the northern Plains and northwest Midwest, posing a “limited threat” to 10% to 15% of corn and soybean crops.

The U.S. agriculture department said on Monday afternoon that 22% of U.S. winter wheat had been planted, up sharply from 8% last week. Some 87% of U.S. spring wheat was harvested, topping market expectations.

Ample wheat supplies from the Black Sea region are posing stiff competition in the market.

Ukraine’s grain exports have risen to about 12.4 million tonnes so far in the 2019/20 July-June export season, up from 8.3 million tonnes over the same period last year, the agriculture ministry said on Tuesday.

The focus is on a wheat tender set by Egypt, the world’s top importer, to buy an unspecified amount of wheat from global suppliers for shipment from Oct. 26 to Nov. 5.

Concerns remain about the Southern Hemisphere wheat crop.

A lack of rainfall and late frosts over Argentina’s main wheat-producing region are already leading to drop in crop yields, the Rosario grains exchange said on Tuesday.

Argentina, a key global wheat exporter, had reported 6.87 million hectares (17 million acres) of growth in the planting area for the 2019/20 season.

Commodity funds were net buyers of CBOT corn, soybean, soyoil and soymeal futures contracts on Tuesday, traders said.

They were net sellers of wheat.

Grains prices at 0355 GMT

 Contract    Last    Change   Pct chg  Two-day chg  MA 30   RSI
 CBOT wheat  481.25  -0.50    -0.10%   -0.36%       476.00  50
 CBOT corn   376.75  2.00     +0.53%   +0.94%       368.26  73
 CBOT soy    896.00  1.75     +0.20%   +0.39%       876.20  66
 CBOT rice   11.97   -$0.04   -0.29%   -0.79%       $11.85  46
 WTI crude   56.95   -$0.34   -0.59%   -2.88%       $56.40  
 Euro/dlr    $1.100  -$0.002  -0.15%   +0.09%               
 USD/AUD     0.6788  -0.001   -0.16%   +0.22%

Most active contracts
Wheat, corn and soy US cents/bushel. Rice: USD per hundredweight RSI 14, exponential
Source: Reuters (Reporting by Naveen Thukral; Editing by Rashmi Aich)

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