Wheat drops for 2nd session to 10-month low on supply pressure

Chicago wheat slid for a second session on Monday to its lowest in 10 months as the market is being weighed down by abundant global supplies.

Soybeans slid, giving up last session’s gains, as rapidly advancing harvest in top exporter Brazil is boosting global supplies.

The most-active wheat contract on the Chicago Board Of Trade was down 0.4 percent at $4.71 a bushel by 0314 GMT, after dropping to its lowest since April 17 at $4.67 a bushel. Wheat closed down 4 percent on Monday.

Soybeans fell 0.3 percent to $9.09-1/4 a bushel, having firmed 0.2 percent on Monday, while corn slid 0.1 percent to $3.70-1/4 a bushel, having closed down 1.3 percent in the previous session.

“World wheat market is still pretty well supplied,” said Phin Ziebell, agribusiness analyst at National Australia Bank.

“Soybeans are down as Brazilian harvest is gathering pace which will increase competition in the market as U.S. pushes to sell soybeans to China, although I think we will have to see where things end up on these trade talks. Overall the global market is well supplied with soybeans.”

Wheat is under pressure on technical selling and concerns about stiff global competition in the export market.

The U.S. Department of Agriculture on Monday said 693,964 tonnes of U.S. wheat was inspected for export last week, above market expectations. But season-to-date inspections are about 1.4 million tonnes behind a year ago.

Soybeans drew support in the previous session after U.S.

President Donald Trump on Monday said he was optimistic a final trade deal with China could be reached, but offered few details. China committed to buy an additional 10 million tonnes of U.S. soybeans in a meeting on Friday, U.S. Agriculture Secretary Sonny Perdue said on Twitter.

But the global market remains amply supplied with beans.

Brazilian soybean farmers have harvested about 45 percent of fields so far in the 2018/19 season as the work is progressing quickly in top-producing state Mato Grosso, consultancy AgRural said in a statement on Monday.

Harvesting of Brazil’s soybean fields is 20 percentage points above last year’s levels and significantly above a five-year average of 27 percent of planted area. Farmers in Mato Grosso have harvested about 80 percent of fields, AgRural said.

Grains prices at 0314 GMT
 Contract    Last    Change  Pct chg  Two-day chg  MA 30   RSI
 CBOT wheat  471.00  -1.75   -0.37%   -4.22%       515.34  17
 CBOT corn   370.25  -0.25   -0.07%   -1.33%       376.52  38
 CBOT soy    909.25  -2.50   -0.27%   -0.11%       912.04  50
 CBOT rice   10.34   $0.00   +0.05%   -0.53%       $10.57  41
 WTI crude   55.24   -$0.24  -0.43%   -3.53%       $53.88  
 Currencies                                                
 Euro/dlr    $1.136  $0.001  +0.04%   +0.19%               
 USD/AUD     0.7165  0.000   +0.00%   +0.53%               
 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 Gopakumar Warrier)