CNS Canada –– Corn and soybean futures at the Chicago Board of Trade are expected to hold near-term ranges, as traders decide where to lay their focus amid a mix of factors.
“Weather will dominate; that’s no surprise to anybody,” said Sean Lusk of Walsh Trading.
That influence is likely to have a supportive effect on corn and soybean markets.
“There’s a lot of noise out there about a cooler, wetter June. Certainly, we’re getting rain in parts of the country where it needs to dry out,” he added.
But reports of big stocks of both commodities in South America add to burdensome ending stocks data in the U.S., Lusk said, which has the potential to limit the upside.
Influence from Brazil has already affected the soybean market, with July soybeans losing about 27 cents per bushel over the week to close Wednesday at $9.4825 (all figures US$).
News from Brazil that President Michel Temer was under investigation for alleged corruption pressured the country’s currency, which led to losses in the CBOT markets.
The Brazilian real “was in a tizzy, and gave thoughts to the funds that the farmers are going to flood the market with freshly cut beans,” said Lusk.
Corn saw more modest declines, only falling about a quarter of a cent to close at $3.7125 per bushel in the July contract on Wednesday.
Lusk noted an ample amount of funds holding short positions in the corn market has the potential to cause a move to the upside.
— Jade Markus writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.