SINGAPORE/PARIS: Chicago soybeans rose for a second session to highest in more than three weeks while corn climbed to its highest since early September on Monday with the market underpinned by concern that dry weather will hurt crop yields in Argentina.
Wheat was also firm, rising for the fourth time out of the past five sessions.
The Chicago Board of Trade most-active soybeans contract rose 1.1 percent to $10.04-3/4 a bushel by 1343 GMT after hitting $10.08-1/2 earlier in the session, the highest since the end of July.
Corn gained 0.3 percent to $3.59-3/4 a bushel. Earlier in the session, the market jumped to $3.60 a bushel, the highest since Sept. 7. Wheat added 0.9 percent to $4.42-1/4 a bushel. The wheat market at intraday high of $4.42-1/2 a bushel was the highest since Nov. 22.
Dry weather across Argentina’s farms is supporting corn and soybean prices.
Parts of the country’s soybean and corn belt received some beneficial rains last week, but dry weather remains a concern across several provinces.
“Although there has been rainfall in some parts of Argentina and the conditions for the young crops are also satisfactory on the whole in Brazil, fears of the impact of the dry spell are supporting corn and soybean prices,” Commerzbank said in a note.
Brazil’s corn production will drop by almost 17 percent in the 2017/18 crop cycle, consultancy Safras & Mercado said on Friday, reflecting a reduction in estimated planted area and lower prices for the grain.
Corn output will total 90.52 million tonnes, compared with a Safras estimate of 108.87 million tonnes for production in the 2016/17 crop season, the consultancy said.
But soybean prices were pressured by an upwards revision in analyst INTL FCStone of its estimate for Brazil’s 2017/18 soy crop to 107.6 million tonnes, as favourable weather is seen boosting agricultural yields.
Gains in corn and soybeans are also likely to be capped by expectations of an increase in US production next year.
US farmers are likely to expand plantings of both corn and soybeans while reducing wheat seedings for the upcoming marketing year, the US Agriculture Department said last week.
Large speculators trimmed their net short position in Chicago Board of Trade corn futures in the week to Nov. 28, regulatory data released on Friday showed.
The Commodity Futures Trading Commission’s weekly commitments of traders report also showed non-commercial traders, a category that includes hedge funds, increased their net short position in CBOT wheat and switched to a net long position in soybeans.
Concerns over storms damaging Australia’s wheat crop eased after less than expected rain over the country’s south-eastern region.
“The market’s fears about several days of heavy rainfall in south eastern crop regions were clearly subsiding on Friday,” Gorey said.
“And these regions seem to have received a lot less rain than was feared on Wednesday and Thursday last week.”
Source: Brecorder.com
