CNS Canada — The ongoing U.S. harvest is keeping a lid on rallies in both the corn and soybean markets. Corn futures on the Chicago Board of Trade chopped above and below the psychologically-important US$3.50 per bushel mark during the week ended Wednesday.
Soybeans felt some pressure from fund selling and generally seemed to be stuck in a range between $9.62 and $9.75 (all figures US$).
One bright spot for the soybean market, though, was the unexpected sale of 1.08 million tonnes of soybeans to unknown destinations on Wednesday, September 20.
“It helps when we have demand news like that,” said Jack Scoville of Price Futures Group in Chicago.
Many participants are waiting for yield reports to come in, he said, as no one seems to have a clear handle on the size of either crop.
“That will dictate market action along with demand news and weather,” he said, adding the corn crop seemed to be drying while soybeans were turning colour.
Scoville puts support for December corn around the $3.40/bu. mark.
“Without confirmation of a super-huge crop we could see some limited downside down to that level perhaps but really not much more,” he said.
China last week auctioned off more of its state corn crop, selling over 700,000 tonnes in one day alone. The auctions aren’t helping prices, Scoville said, but he’s not sure they’re really hurting them either.
“We know China isn’t a big buyer in the corn market,” he said. “They also made it pretty clear they were getting ready to sell a bunch of corn.”
For soybeans, Scoville pegged the next support level down at $9.60 a bushel, but said there is room to the upside.
“We could have a shot at $10,” he said. “Depending on how these yields turn out.”
On the international front, dry conditions in Brazil have delayed planting of soybeans in some regions, which was supportive for U.S. prices.
— Dave Sims writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.