Wednesday, 18 March 2015 11:41
SYDNEY: US soybean futures rose nearly 0.5 percent on Wednesday, climbing from their lowest in more than five months touched the session before, but expectations of ample South American supply capped gains.
Wheat edged higher after losses of 2 percent the day before, while corn gained 0.5 percent to inch away from a near five-month low.
Chicago Board of Trade front-month soybeans had climbed 0.4 percent to $ 9.58-1/4 a bushel by 0231 GMT, having closed down 1.5 percent on Tuesday when prices hit a more than five-month low at $ 9.53-1/2 a bushel.
Analysts said expectations of ample South American production continued to weigh on prices, with Brazilian exports likely to capture a large amount of global demand.
“If you look at the U.S balance sheet, I would define it as pretty tight soybean stocks, but there are high stocks in Argentina and Brazil,” said Paul Deane, senior agricultural economist, ANZ Bank.
“In addition to this, you have the strengthening US dollar and those South American stocks look a look more attractive.”
May corn rose 0.5 percent to $ 3.73 a bushel, having slumped 2.1 percent in the previous session when prices marked their lowest since October at $ 3.70 a bushel.
China, the world’s second-largest corn consumer, has booked over 600,000 tonnes of corn from Ukraine this year and more deals from the Black Sea are expected.
US farmers will likely use less nitrogen fertilizer this season with the cost sky-high, even though the price of natural gas, the key ingredient to make it, is down 40 percent from last year.
May wheat climbed 0.1 percent to $ 5.04 a bushel, having closed down 2 percent on Tuesday.
Ongoing concerns over unfavourable weather across key growing regions in the United States continued to provide support, traders said.
The US Department of Agriculture this week said that Kansas winter wheat was rated 41 percent good to excellent, down from 46 percent in the previous week. Ratings for Oklahoma winter wheat fell 2 percentage points to 40 percent good to excellent.
Russia’s winter grains are in a worse condition than last year after a dry autumn, the head of Russian weather forecaster Hydrometcentre said on Tuesday, adding to concerns over this year’s harvest.
Copyright Reuters, 2015