CNS Canada –– A data set from the U.S. Department of Agriculture (USDA) has given traders a better idea of yield potential, which will dictate short-term market movement.
Soybeans — The soybean market will likely trend lower in the near-term, said Terry Reilly of Futures International in Chicago.
“We’re still bearish, given that we think the USDA went too high on their soybean demand outlook for this crop year,” Reilly said.
USDA expects American soybean exports to reach 1.985 billion bushels in 2016-17, the agency said in its world agricultural supply and demand estimates (WASDE) report.
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Chicago Board of Trade soybean futures jumped on hopes for U.S. export demand on Wednesday, while corn futures rose for a third day to extend a recovery from contract lows, analysts said.
High yield projections have added further pressure to the market over the week, a trend which is expected to continue.
USDA upwardly revised its yield estimates to 50.6 bushels an acre.
November soybeans could move below $9.20 a bushel in coming sessions, Reilly said (all figures US$). That contract has lost 32.75 cents per bushel since last week, closing at $9.4275 on Wednesday.
Traders, he added, will also be closely monitoring weekly export sales for direction.
Corn — Despite the expectation for record supplies, disease concerns are balancing that pressure, Reilly said.
Too much rain in the western Corn Belt is keeping prices supported.
USDA also expects reduced yields, downwardly revising estimates to 174.4 bushels an acre.
Reilly expects the corn market to stay in a $3.15-$3.45 trading range in the December contract.
Since last week, corn prices have lost 1.5 cents per bushel in the December contract, closing at $3.3175 on Wednesday.
— Jade Markus writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.
