PARIS/SINGAPORE: Chicago soybeans ticked higher on Thursday, steadying after a slide triggered by an escalating US-China trade dispute, with attention shifting to US government crop forecasts later in the day.
Corn was also firm, recovering like soybeans from contract lows in the previous session. Favourable growing conditions for both crops in the US
Midwest have weighed on prices and investors are waiting to see if the US Department of Agriculture (USDA) raises its production outlook in a monthly report at 1600 GMT.
Wheat also recouped a little ground after losing 8 percent in the past three sessions, partly due to improving prospects for US spring wheat.
The most-active soybean contract on the Chicago Board of Trade was up 0.3 percent at $8.50-3/4 a bushel by 1140 GMT. It closed down 2.7 percent on Wednesday at $8.47-1/4, its lowest close since early 2009.
CBOT corn gained 0.4 percent to $3.54-1/2 a bushel. Individual delivery months for both corn and soybeans set contract lows in the last session.
Wheat added 0.5 percent to $4.74-1/4 a bushel, after shedding 8 percent over the past three sessions.
“Grain markets are firmer as bargain hunters provide support. December corn futures after three sessions (were) down 20 cents while November soybeans were down 46 cents,” US brokerage Allendale said in a note.
Worries about rising trade tensions with China sapped financial markets on Wednesday after Washington detailed products to be covered by a 10 percent tariff on an extra $200 billion worth of Chinese imports. China has vowed to strike back.
China on Thursday cut its forecast for soybean imports in 2018/19 by 1.8 million tonnes to 93.85 million, warning higher prices due to the trade conflict with the United States would curb demand as farmers switch to alternative animal feed ingredients.
The president of state grains trader COFCO was quoted on Wednesday as saying China could reduce reliance on US soybeans by increasing imports of soybeans from other countries, or other oilseeds, or meat directly.
Analysts said the market had priced in for now China’s higher tariffs on US soybeans and that other destinations should absorb attractively priced US supplies.
“The US is the cheapest soybean supplier now and non-Chinese demand should remain strong for US beans,” said an India-based agricultural commodities analyst at an international bank.
Grain markets will get an update on US export demand from weekly USDA data due at 1230 GMT.
Forecasts for a favourable mix of rain and moderate heat in the week ahead in the US Midwest have underscored good growing conditions for US corn and soybeans.
Wheat has also been curbed by favourable weather for spring crops in the northern US Plains, taking attention away from falling expectations for harvests in Europe and the Black Sea region.
Source: Brecorder
