Wednesday, 26 August 2015 17:20
HAMBURG/SYDNEY: US soybeans fell on Wednesday on concern that Tuesday’s interest rate cuts may not be enough to stimulate growth in China, the world’s largest soybean importer.
Corn and wheat rose, rebounding from losses on Tuesday.
Soybean futures dropped to their lowest in over six years on Monday on worries about import demand as China’s economy falters, but rose in bargain-buying on Tuesday after China cut interest rates to spur growth.
“We had seen a recovery on Tuesday after the Chinese government’s interest rate moves, but we are seeing a return of negative sentiment about China’s economic prospects which is also hitting other markets such as equities,” said Frank Rijkers, agrifood economist at ABN AMRO Bank.
Chicago Board of Trade November soybeans fell 0.4 percent to $ 8.73-1/2 a bushel at 0943 GMT, having risen about 0.3 percent on Tuesday.
December corn rose 0.4 percent to $ 3.78-1/2 a bushel. December wheat rose 0.7 percent to $ 5.03 a bushel, having dropped sharply on Tuesday.
World equities slumped and metals and crude oil markets struggled on Wednesday as investors feared fresh rate cuts in China would not be enough to stabilise China’s slowing economy or end a collapse in Chinese stocks that is wreaking havoc in global markets.
“Soybeans are again reflecting the broader trends,” said Phin Ziebell, agribusiness economist at National Australia Bank. “When you look at the supply side, it is looking very healthy so there is no reason to expect any supply constraints…in the short-term.”
Corn and wheat markets shrugged off the China concerns.
“Wheat seems to be recovering from bargain buying after falls on Tuesday despite a good global supply outlook,” Rijkers said. “There is also some support for US prices from belief rival European Union wheat exports could be reduced by the recent strength of the euro.”
Corn has drawn some support this week amid uncertainty over the size of the US crop.
“Corn is seeing some bargain-buying support and also some concern about the state of the US crop, as the latest crop tour forecasts in the US were somewhat more pessimistic than previous estimates,” Rijkers said.
US corn and soybean crops do not have harvest potential as high as the US Department of Agriculture’s latest forecast, according to estimates on Friday from farm advisory service Pro Farmer at the end of its annual Midwest crop tour.
