US soyabeans rebounded on Monday on technical buying and short covering after hitting a 6-1/2-year low following the weekend election in Argentina of a president who has promised to cut export taxes and boost production. Corn and wheat prices on the Chicago Board of Trade recovered from earlier losses tied to broad selling across commodities markets, also lifted by short covering and technical buying.
The firm US dollar remained a bearish factor for grains, creating headwinds in export markets where dollar-denominated commodities become more expensive for buyers holding other currencies. Conservative opposition candidate Maricio Macri comfortably won Argentina's presidential election on Sunday after promising business-friendly reforms to spur investment in the struggling economy.
Argentine grains output would shoot 30 percent higher by 2019 as Macri is expected to make good on his vow to cut export taxes and state controls that have weighed on production, his farm advisor said in an interview earlier this month. "In the short term, the trade assumes this is bearish beans as there are some beans waiting to be exported," said Rich Nelson, chief strategist with Allendale Inc.
"In the longer term, years two or three or four of his presidency, is when we may see some effects from changes in crops and we could see more corn and wheat production at the expense of soyabeans," he said. CBOT January soyabeans were up 3-3/4 cents, or 0.4 percent, at $8.61-1/4 a bushel by 12:06 pm CST (1806 GMT) after earlier hitting a contract low of $8.44-1/4, the lowest spot contract price since March 2009.
December corn rose 2-1/4 cents, or 0.6 percent, to $3.65-1/2 a bushel while CBOT December wheat gained 5-1/4 cents, or 1.1 percent, to $4.94 a bushel. Hard red winter wheat futures posted contract lows before recovering, with December up 5 cents, or 1.1 percent, at $4.62 a bushel. However, gains in both corn and wheat remain restricted by sluggish US exports, which are lagging the normal pace amid ample global supplies of often-cheaper grain. Beneficial precipitation in key wheat-producing areas of the United States also capped gains in wheat.