Thursday, 13 August 2015 19:18
PARIS/SYDNEY: US soybeans rose on Thursday, recovering some ground after a 6 percent slide in the previous session, as analysts reassessed the government’s upgrade of its harvest outlook, which had sparked the selloff.
Corn steadied after tumbling 4.6 percent a day earlier when the US Department of Agriculture also lifted its corn crop forecast. Wheat also recovered after tracking corn and soybeans lower on Wednesday.
The USDA stunned the market with its increased soybean and corn production estimates when traders and analysts had been anticipating downward revisions after heavy rain earlier in the season. The unexpected increase to US supply came after the US soybean market had been wrestling this week with risks that a Chinese currency devaluation may hurt demand for foreign grain. “Last night the biggest supplier, the United States, said it had lots more supply than originally thought.
And over the past two days the biggest buyer, China, has taken upon itself to increase prices,” said Tobin Gorey, director of agricultural strategy, Commonwealth Bank of Australia, in a note to clients.
Chicago Board of Trade November soybeans rose 1 percent to $ 9.19-1/2 a bushel by 1156 GMT, after closing down 6.3 percent on Wednesday, when prices fell to as low as $ 9.01-1/2, a level not seen since June 15.
CBOT December corn added 1 percent to $ 3.71-1/2 a bushel, recovering from a contract low of $ 3.57-1/2 struck on Wednesday.
However, some analysts said they still expected the USDA to scale back its harvest outlook, with attention now turning to next week’s Pro Farmer Midwest Crop Tour.
“Based on our conversations with agronomists and other industry participants, our initial expectations on the tour will be to find conditions that corroborate our downward bias to yields versus the USDA,” Societe Generale analyst Christopher Narayanan said in a note. CBOT September wheat rose 0.8 percent to $ 4.96-1/4 a bushel.
The USDA trimmed its US wheat harvest estimate but raised world production to a record high.
Wheat prices could be curbed by the results of a latest tender by Egypt, which is expected to show Black Sea origins remain much cheaper than US supply in the Middle East.
Grain markets will also get a fresh indication on demand from weekly US export sales due at 1230 GMT.
