U.S. soybean futures plunged 2-1/2 per cent on Wednesday, surrendering all of the prior session’s gains in a profit-taking setback amid a slightly better forecast for parts of the Midwest, where dry weather has eroded yields.
The oilseed was also pressured by talk that top importer China was planning to auction more soybeans from state reserves in coming months, which may blunt demand for imports.
Corn fell for a second straight session and hit a 1-1/2 week low, dragged down by the advancing harvest of an expected record-large U.S. crop and weak cash markets.
Wheat also hit a 1-1/2 week low on spillover pressure from corn and soybeans and as U.S. exports continue to struggle to compete in international markets with lower-cost grain from rival suppliers.
“The forecast is slightly wetter,” said Rich Nelson, chief strategist with research advisory firm Allendale Inc. “It’s not a dramatic change, but it’s enough of a reason to take some profit off the table today.”
Eastern Iowa, northern Illinois and southern Wisconsin may see more rain by the weekend, but dry weather elsewhere is still likely to trim corn and soybean yield potential, said Don Keeney, a meteorologist for MDA Weather Services.
“It will help a little bit, but there are no widespread showers,” he said. “It will stay pretty dry elsewhere.”
Yield prospects for corn and soybeans have been declining amid crop-stressing Midwest weather in recent weeks, although the corn harvest is still expected to be the largest ever.
Analysts on average expected a U.S. corn yield of 153.985 bushels per acre and a soybean yield of 41.09, according to a Reuters poll of 20 analysts.
November soybeans on the Chicago Board of Trade fell 34-1/4 cents, or 2.5 per cent, to $13.52-1/2 per bushel, the steepest decline in nearly six weeks (all figures US$).
CBOT December corn fell 5-3/4 cents, or 1.2 per cent, to $4.69-1/2 per bushel.
CBOT December wheat shed one cent, or 0.2 per cent, to $6.46-1/4 a bushel.
U.S. wheat was not offered in the latest snap tender by Egypt’s state wheat buyer, GASC, as prices were not competitive. GASC bought 180,000 tonnes of Black Sea region wheat in the tender.
Commodity funds were net sellers of an estimated 4,000 corn contracts and 8,000 soybean contracts but were net even in wheat, trade sources said.
— Karl Plume reports for Reuters from Chicago. Additional reporting for Reuters by Sam Nelson.