CNS Canada — Chicago Board of Trade soybeans and corn are in search of bullish news to keep their upward momentum going, according to a market watcher.
Soybean futures on the Chicago Board of Trade (CBOT) rose during the week ended June 1 as poor weather hurt production estimates in Argentina.
The front-month July contract gained US13.75 cents on the week.
Values took strength from ideas that a La Nina weather event later this summer will stress the U.S. crop with hot, dry weather.
Demand for U.S. supplies has been reasonable, with speculation exports could increase down the road.
“We’re going to be watching if additional Chinese demand comes on the market,” said Terry Reilly of Futures International in Chicago.
Further downgrades to the soybean crop in South America could also become a bullish factor for the market, he added.
“But with U.S. weather improving and plantings getting into the ground in a timely manner we’ll probably see a sideways trading pattern for soybeans,” he said.
Corn futures chalked up gains during the week as strong export numbers in the U.S. buoyed investor interest.
The July contract strengthened by nine U.S. cents over the period.
Wet weather across the U.S. Midwest has prompted many farmers to switch out corn acres in favour of soybeans, which was bullish for prices.
The crop is looking good, which has weighed on the prices somewhat, Reilly said. According to the U.S. Department of Agriculture, 72 per cent of the crop in the U.S. is in good or excellent shape, which was ahead of most analysts’ expectations.
“We had an excellent initial rating come from the USDA, my bias is for corn prices to maybe retreat to just below the US$4 level by this time next week,” he said.
— Dave Sims writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.