SINGAPORE: Chicago soybean futures rose for a fifth consecutive session on Thursday to their highest in more than two weeks, as hot and dry weather conditions expected in parts of the US Midwest threaten to reduce yields.
Wheat gained 1.3% while corn rose 0.9%. “Dry weather is beginning to impact the US soybean crop, and that is causing concerns over supplies,” said a Singapore-based trader.
“There is upside potential for soybean and edible oil markets as prices have hit the bottom.”
The most-active soybean contract on the Chicago Board of Trade (CBOT) was up 1.4% at $14.29 a bushel, as of 0331 GMT, after climbing earlier in the session to its highest since July 11 at $14.34 a bushel. Wheat rose 1.3% to $8.00-3/4 a bushel and corn gained 0.9% to $6.08-1/2 a bushel.
US corn and soybeans are enjoying a shot of seasonably cool weather this week, though a menacing hot and dry forecast for next week and beyond has both farmers and traders on edge, Karen Braun, a market analyst for Reuters, wrote in a column.
Lack of moisture could hurt soybean plants as they develop pods.
CBOT soybeans biased to test resistance at $13.47-1/4
“Corn and soybean yield potential is particularly sensitive to the weather in July and August, which is why the market is often glued to every new forecast model run this time of year, as each update could potentially enhance or change current sentiment.”
Wheat rose on doubts over supplies from the Black Sea region despite an agreement to reopen Ukrainian maritime grain exports.
Turkish Defence Minister Hulusi Akar unveiled a centre in Istanbul on Wednesday to oversee the export of Ukrainian grains after a landmark UN deal last week, with the first shipment expected to depart from Black Sea ports within days.
Russia and Ukraine signed the deal, brokered by Ankara and the United Nations, on Friday to reopen grain and fertiliser exports that have been blocked by war to ease an international food crisis.
The Russia-focused Sovecon agriculture consultancy has raised its forecast for the country’s July-June 2022/2023 wheat exports by 300,000 tonnes to a record high of 42.9 million tonnes, it said on Wednesday.
The wheat crop estimate has been upped by 1.7 million tonnes to 80.9 million tonnes, the consultancy added in a note Indian wheat prices jumped to a record high, despite a ban on exports, amid strong demand and dwindling supply from a crop damaged by heat wave.
The price rally has reduced chances of India supplying substantial amounts of wheat under government-to-government deals with countries struggling to secure shipments amid the disruption of the war in Ukraine.
Commodity funds were net buyers of CBOT soybeans, soyoil, soymeal and corn futures contracts on Wednesday and net sellers of CBOT wheat futures contracts, traders said.
Source: Brecorder
