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U.S. grains: Soy, corn futures ease off six-year highs

New USDA reports awaited

cbot march soybeans
CBOT March 2021 soybeans with 20- and 50-day moving averages and March 2021 soybean oil (dark green line). (Barchart)

Chicago | Reuters — U.S. soybean futures declined on Thursday for the first time in seven sessions, pausing after concerns about dry weather in South America and export disruption in Argentina pushed prices to their highest in more than six years.

Corn futures also eased and wheat fell for a second session after hitting multiyear highs this week.

Chicago Board of Trade March soybeans settled down 6-1/4 cents at $13.55-1/4 a bushel but pared losses toward the close. March corn ended down one cent at $4.94 a bushel and CBOT March wheat fell 5-1/4 cents to settle at $6.42-1/4 a bushel.

Soybeans were pressured by profit-taking after the fund-driven rally, and as weekly export sales data fell well below expectations.

The U.S. Department of Agriculture reported export sales of U.S. old-crop soybeans in the week ended Dec. 31 at just 37,000 tonnes, the lowest weekly total so far in the 2020-21 marketing year that began Sept. 1. Traders had expected sales of 400,000 to 800,000 tonnes.

However, through its daily reporting system, USDA also confirmed fresh sales of 343,350 tonnes of U.S. soybeans to unknown destinations.

News of a resolution to an Argentine port workers’ strike added to bearish sentiment. The union representing Argentine portside grain inspectors said it had ended a month-long wage strike after reaching a contract deal with export companies that will allow international soy, corn and wheat shipments to return to normal.

In addition, a bounce in the dollar hung over the markets, making U.S. grains and soy less competitive on the world market.

Traders have begun adjusting positions ahead of USDA’s Jan. 12 monthly supply/demand and quarterly stocks reports. While the market has been fixated on fears of tightening U.S. and global soy supplies, some analysts believe USDA might not be as aggressive in adjusting its supply and demand forecasts next week.

“USDA has a history of not getting too bullish or frothy. They like to see evidence of demand before inserting it,” said Rich Feltes, vice president for research with R.J.O’Brien.

— Julie Ingwersen is a Reuters commodities correspondent in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.

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