U.S. grains: Soybeans hit 2-month high before paring gains; corn, wheat sag

Chicago | Reuters—U.S. soybean and corn futures climbed to two-month highs on Tuesday, following broad gains in commodity and equity markets after China unveiled economic stimulus measures, but pared gains as forecasts called for improved crop weather in South America, analysts said.

Benchmark Chicago Board of Trade soybean futures Sv1 settled up 3 cents at $10.42-1/4 per bushel after rising to $10.58-1/4, the highest on a continuous chart of the most-active contract since July 26.

CBOT corn and wheat futures turned lower on seasonal pressure from the ongoing U.S. corn harvest and strong export competition for wheat, primarily from top exporter Russia.

CBOT corn Cv1 ended down 1-3/4 cents at $4.11-3/4 a bushel, turning lower after a climb to $4.18-1/4, its highest since July 26. CBOT wheat Wv1 finished down 4-1/2 cents at $5.78 a bushel, retreating from a one-week high.

Soybeans paced the early rally after the central bank of China, the world’s top soy buyer, announced broad monetary stimulus and property market support measures to revive its economy.

But prices cooled on profit-taking, farmer selling and some forecast models predicting much-needed rains in Brazil next week that could bolster soybean planting and crop prospects.

“The fact that the rain was still in there in the midday (model) run, I think that’s why soybeans faded off their highs,” said Ted Seifried, strategist at Zaner Group.

Others noted a lack of major soybean export sales announcements from the USDA, given market rumours that Chinese buyers were booking U.S. supplies.

“We have not seen much in the way of confirmations of export sales, despite all sorts of talk that China has been a pretty active buyer over the last week,” said Jack Scoville, analyst with the Price Futures Group in Chicago.

The U.S. corn and soybean harvest is progressing although rains crossed the central Midwest on Tuesday, interrupting fieldwork in some areas.

In a weekly report released after Monday’s market close, the USDA pegged the soybean harvest as 13 per cent complete and the corn harvest as 14 per cent done, both ahead of their respective five-year averages.

—Additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore