US soyabean futures rose on Tuesday, as export demand for US supplies remained strong even as domestic stocks dwindled, traders said. Corn and wheat futures also advanced, with the market stabilising as the threat of military violence in Ukraine, a key producer and exporter of both commodities, eased.
Traders said that US soyabeans remained the top choice for China, the largest buyer of the oilseed, due to production concerns and a slow harvest that delayed the shipment of supplies from Argentina and Brazil. "They are going to continue to take our beans because we seem to be the most reliable supplier right now," said Bill Gentry, a broker with Risk Management Commodities in Chicago.
There was talk that China was deferring some shipments from South American producers originally slotted for April until later in the year, Gentry said. Soyabean and Corn Advisor President Michael Cordonnier, an agronomist specialising in South America, cut his outlook for soyabean production in Brazil to 87 million tonnes, 3 million lower than the US Agriculture Department's latest estimate. Cordonnier pegged Argentine soyabean production at 53.5 million tonnes.
Private analytics firm Informa Economics lowered its estimate of the Brazilian soyabean crop to 88.8 million tonnes and cut its Argentine soyabean harvest forecast to 54 million tonnes, trade sources said. At 11:11 am CST (1611 GMT), Chicago Board of Trade May soyabeans were up 11 cents at $14.20-1/4 a bushel. CBOT May corn was 5 cents higher at $4.75-1/2 a bushel and CBOT May wheat was 4-1/2 cents higher at $6.36 a bushel.
The May wheat contract briefly topped its 100-day moving average for the first time since October 31, but could not hold support above that key technical benchmark. President Vladimir Putin ordered troops in western Russia to return to base after military exercises and said the use of force by Russia in Ukraine was a choice of "last resort." The news sent prices of oil, gold and grains into retreat after they had spiked on Monday as Russia tightened its grip on Ukraine's Crimea region. Equities, including Russian stocks, rebounded. "With Russia recalling their troops, it reduces the risk of escalating tensions between Ukraine and Russia," said Vanessa Tan, investment analyst at Phillip Futures. "This eased concerns that the unrest would disrupt grains exports in the Black Sea region."
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