SINGAPORE: Chicago soybean futures slid for the first time in four sessions on Wednesday, after climbing to a two-week high in the previous session on concerns over hot weather in the US Midwest hurting this year’s potential record crop.
Soybeans drop 1%, corn hits one-week low on forecast of bumper US crops
Corn and wheat edged lower, after closing higher on Tuesday, with ample world supplies adding pressure on prices.
Fundamentals
The most-active soybean contract on the Chicago Board of Trade (CBOT) was down 0.1% at $9.86 a bushel, as of 0055 GMT, after climbing on Tuesday to its highest since Aug. 12 at $9.92 a bushel.
Corn fell 0.3% to $3.91-1/2 a bushel and wheat gave up 0.3% to $5.33-3/4 a bushel.
Worries over a heatwave and lack of rainfall in large parts of the US Midwest underpinned prices in the last few sessions as it could damage the soybean crop during its key development stage.
However, the extreme heat in the central US was expected to moderate as the week progresses, according to Commodity Weather Group.
The US Department of Agriculture weekly crop progress and condition report, released on Monday after trading ended, showed corn, soybean and wheat ratings below analysts’ expectations.
The government agency rated 65% of the US corn crop as “good to excellent”, down from 67% the prior week, while analysts surveyed by Reuters on average had expected only a one-point drop.
Argentine farmers are likely to plant more soybeans in the current 2024/25 season, trimming the area dedicated to corn after that crop’s last harvest was hit by a devastating insect plague and with rain forecasts looking rosier for soy.
China’s COFCO International expects the area planted with soybeans in Brazil to grow in 2024/25 at its slowest pace in a decade when compared to the previous season, a top executive at the firm told Reuters.
Commodity funds were net buyers of CBOT corn, wheat, soybean and soymeal futures contracts, and were net sellers of soyoil futures contracts on Tuesday, traders said.