Chicago | Reuters — U.S. wheat futures fell on Tuesday on a profit-taking setback, with the benchmark Chicago Board of Trade soft red winter wheat contract sagging 1.9 per cent from the nine-year high it hit on Monday.
Corn and soybean futures also were lower, but the declines were kept in check by signs of strong export demand, traders said.
A video call on Monday between U.S. President Joe Biden and Chinese counterpart Xi Jinping has also spurred hopes that renewed dialogue could bolster Chinese buying of U.S. soybeans.
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Chicago Board of Trade soybean futures touched a two-week high on Friday on worries that heat may threaten U.S. crops and expectations that the country’s biofuel policy would boost demand for soyoil, analysts said.
“The market suspects that China’s importers have and will make hefty purchases of U.S. soybeans in that context,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.
A strong dollar, which makes U.S. commodities less attractive to investors looking for a hedge against inflation, added pressure as the greenback rose to a 16-month high.
“This is really the last thing we need for our commodities,” said Brian Hoops, president of Midwest Market Solutions.
CBOT December soft red winter wheat futures closed down 16 cents at $8.10-1/4 a bushel, its biggest one-day decline since Oct. 13. K.C. hard red winter wheat and MGEX spring wheat contracts also were sharply lower.
CBOT January soybeans were down six cents at $12.51-1/4 a bushel and CBOT December corn was off 5-1/2 cents at $5.71 a bushel.
The U.S. Agriculture Department on Tuesday morning said that private exporters reported the sale of 270,000 tonnes of corn to Mexico, the second day in a row a sale was announced to the top buyer of U.S. supplies of the grain.
Exporters also reported the sale of 161,000 tonnes of soybeans to unknown destinations, the third trading day in a row that a so-called flash sale of soybeans was announced.
— Mark Weinraub is a Reuters commodities correspondent in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.
