Chicago | Reuters — U.S. soybean futures rose for a second straight session on Friday on short-covering and follow-through buying after a government report the prior day forecast a smaller-than-expected U.S. harvest.
Corn also advanced after the U.S. Department of Agriculture (USDA) unexpectedly cut its U.S. corn yield outlook in a monthly report on Thursday and as traders braced for possible further cuts to the agency’s crop outlook.
Wheat prices jumped on tightening global supplies and hopes for a U.S. export revival given smaller crops in rival suppliers Russia and Australia.
Chicago Board of Trade November soybeans rose 9-1/4 cents to $8.67-1/2 a bushel, holding chart support at its 50-day moving average but ending down 0.2 per cent on the week (all figures US$).
December corn touched a 7-1/2 week high and was up 4-1/2 cents at $3.73-3/4 a bushel, notching a 1.5 per cent weekly gain in a second straight weekly advance. The contract settled just below its 100-day moving average, a technical level it has not breached since early June.
“Yesterday’s report laid the groundwork that the big crops are not getting bigger in USDA’s eyes,” said Mike Zuzolo, president of Global Commodity Analytics.
Rainy harvest weather in the central U.S. further fuelled those concerns, he said.
“There are lots of soybeans in the fields, but are those beans actually going to get into the bins and into the marketing supply chain?” he said.
Drier Midwest weather is expected in the second half of October, but heavy rains this week have already delayed the harvest and may have damaged some crops.
USDA is due to update crop progress and condition ratings on Monday afternoon.
Soybean traders are monitoring trade tensions between the United States and China, which cancelled some of its U.S. soybean purchases last week, according to USDA data released on Friday.
China brought 8.01 million tonnes of the oilseed in September, down from 9.15 million tonnes in August and below the 8.11 million tonnes in September 2017, according to Reuters calculations based on Chinese customs data.
The wheat market was underpinned by tightening world supplies after USDA cut forecasts for Russian and Australian crops on Thursday. Traders are anticipating a pickup in the sluggish pace of U.S. wheat export sales as prices have recently slipped to levels that are more competitive in the global marketplace.
CBOT December wheat rose 9-1/4 cents to $5.17-1/4 a bushel, up 0.7 per cent in the week.
— Karl Plume reports on agriculture and agribusiness for Reuters from Chicago; additional reporting by Naveen Thukral in Singapore and Nigel Hunt in London.Tagged cbot, closing markets, corn futures, soybean futures, soybeans, USDA, wheat futures