SINGAPORE, Jan 23: U.S. soybeans ticked down on Friday to near their lowest since late October and were on track for a second week of decline, under pressure from forecasts of record output in Brazil.
Corn was largely unchanged as the market took a breather, after dropping for two straight days on expectations of a slowdown in demand for grain-based fuel ethanol, while wheat eased amid lacklustre U.S. exports.
Soybeans have lost 7.3 percent in two weeks, biggest decline in since July, while corn has shed more than 4 percent over the period. Wheat is largely unchanged for the week after sliding for the past four weeks.
‘The demand for U.S. products is slowing down as customers, including, Chinese importers, are shifting their buying to South America,’ said Kaname Gokon, general manager of research at brokerage Okato Shoji in Tokyo.
‘We expect March corn to trade between $3.75 and $3.80 a bushel next week and soybeans below $9.70 a bushel.’ Chicago Board of Trade March soybeans gave up 0.1 percent to $9.75-1/2 a bushel by 0257 GMT, corn was flat at $3.83-3/4 a bushel and wheat dipped 0.3 percent to $5.32-1/4 a bushel. U.S. ethanol inventories continued to weigh on corn prices, with weekly ethanol stocks pegged up 158,000 barrels to 20.4 million barrels. Ethanol output is expected to trend lower in the coming months due to weakening margins, an indication that demand for corn in production of the grain-based biofuel could slow down.
The weakness in prices of crude oil is also adding to the pressure on corn. Oil prices have more than halved since peaking in June last year, as soaring supplies clash with cooling demand due to economic slowdown in Europe and Asia. The International Grains Council raised its 2014/15 world corn crop estimate to a record 992 million tonnes from 982 million. Forecasts for timely rains in Brazil, a major corn and soy producer, has lifted crop expectations. Ukraine’s Agriculture Ministry has reached a preliminary agreement with traders to limit milling wheat exports to 1.2 million tonnes in January through June, traders said on Thursday. They said the deal, likely to be signed in coming days, stated exports of milling wheat should not exceed 900,000 tonnes in the first quarter and 300,000 in the following three months. (AGENCIES)
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