SINGAPORE, Sept 6: Chicago soybeans lost more ground on Thursday, sliding to a one-week low as the start of the U.S. Harvest weighed on prices amid reports of rains improving yields of the late planted crop.
Wheat rose half a percent, with the market taking a breather after four straight sessions of decline, which was triggered by U.S. Weather and competition from the Black Sea suppliers. Corn ticked up after losing almost 2 percent on Wednesday.
Commodity brokerage INTL FCStone cut its estimate of this year’s 2012 U.S. Corn crop but raised its soybean production forecast after some late rains.
The firm predicted U.S. Corn production of 10.607 billion bushels, based on an average yield of 121.4 bushels per acre. Soybean production was seen at 2.739 billion bushels, based on an average yield of 36.7 bushels per acre.
‘There is some pull back in prices ahead of the harvest,’ said Abah Ofon, an analyst at Standard Chartered Bank in Singapore. ‘The market is now starting to discount a lot of bad news as I don’t think we are going to see a huge deterioration in yields.’
Chicago Board of Trade new-crop November soy fell 0.7 percent to $17.35 a bushel by 0346 GMT, after touching a low of $17.25-1/2 a bushel, the lowest since August 29.
December corn rose 0.3 percent to $7.92-3/4 a bushel, while December wheat gained 0.6 percent to $8.72-1/2 a bushel.
Soybean prices in the U.S. Cash market have been tumbling on expectations of increased supplies from the harvest, although the output is expected to be much smaller, due to the worst drought in half a century.
Soybean prices in China, the world’s biggest importer, tumbled in sympathy with the U.S. Market. The most-active Dalian soybeans contract lost 2 percent to 4,926 yuan a tonne. January soymeal futures fell nearly 1.7 percent to 4,244 yuan after hitting a record top on Tuesday.
Analysts in China said record soymeal prices could have resulted in end-users switching to alternative sources of feed grain supplies.
‘Such high prices would lead to substitution or reduction of usage of the protein with more wheat or corn use by feed mills,’ said Zhou Lei, an analyst with HNK Futures. ‘China’s soy imports from September to December will be lower.’
U.S. Wheat rose half a percent, ending a four-session declining streak. The wheat market has been under pressure as rains improved prospects for the drought-stricken U.S. wheat crop and on signs of stiff competition from Black Sea sellers.
Russian wheat is still pouring into global export markets despite fears drought will cut the crop by 30 percent this year. Russian wheat was offered at an unbeatable $40 a tonne cheaper than U.S. Supplies in a weekend purchase tender from Egypt, traders said.
The Egyptian state’s main wheat buying agency, the General Authority for Supply Commodities (GASC), on Wednesday set another tender to buy an unspecified amount of wheat for October and November shipment.
The worst drought in the United States in more than half a century had led to concerns about autumn seeding of winter wheat, but wetter weather is helping alleviate those concerns and weighing on prices.
Hurricane Isaac slammed into the U.S. Gulf Coast last week and remnants include welcome rain across a broad swathe of the U.S. Midwest and portions of the Plains winter wheat region.
Rains were expected to continue in the central Midwest, slowing the corn and soybean harvests but adding valuable soil moisture ahead of winter wheat plantings.
(agencies)
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