CANBERRA: Chicago soybean futures rose on Friday, heading for a fourth consecutive weekly gain amid expectations of strong demand from China and worries about the weather in top exporter Brazil, while corn and wheat edged lower.
Soybean supply is ample for now but low rainfall in northern cropping areas in Brazil is causing concern and lifting prices, said Vitor Pistoia at Rabobank in Sydney.
Dry conditions in the region – which starts to harvest around January – are likely to reduce yields, tightening global supply from around April onwards, he said.
The most-active soybean contract on the Chicago Board of Trade (CBOT) was up 0.4% at $13.33-1/4 a bushel by 0423 GMT and up 1% this week. Soybeans have risen 6.5% from last month’s 22-month low of $12.51 but remain down around 12.5% from the start of the year.
China’s soybean imports are likely to stay high through the fourth quarter, taking 2023 purchases to an all-time record, analysts and traders said.
China’s 2023 soybean imports seen at record 105mn metric tons on strong Q4 arrivals
Bolstering hopes for strong exports was news that US agriculture industry representatives met with their Chinese counterparts in Beijing on Thursday to boost farm trade.
Recent data showed that US soybean meal exports were well on their way to new highs this season after a bad soybean harvest in top soymeal supplier Argentina earlier this year.
Farmers in Argentina received 50-60 millimeters (2-2.4 inches) of rain on Thursday, providing relief to crops, the Rosario grains exchange said.
In other crops, CBOT wheat fell 0.1% to $5.65 a bushel and was down 1.8% from last Friday’s close. Corn slipped 0.1% to $4.69-1/2 a bushel and was down 2.4% over the week.
In wheat markets, the Buenos Aires grains exchange cut its forecast for Argentina’s 2023/24 crop to 15.4 million metric tons from 16.2 million tons, citing adverse weather.
Ukraine’s grain exports rose by 20% to 2.5 million tons in October versus September thanks to a new Black Sea export corridor, the UCAB agricultural business association said, easing supply fears.
Weekly US export sales data was disappointing, with the government reporting sales of 2023/24 wheat in the week ended Oct. 26 at 275,600 metric tons, below trade expectations for 300,000 to 600,000 tons.
Commodity funds hold a large net short position in CBOT wheat, leaving the market vulnerable to bouts of short-covering.
Fund speculators were net buyers of Chicago soybean, wheat and soyoil futures on Thursday and net sellers of corn and soymeal, traders said.
Source: Brecorder
