U.S. grains: Soy at three-week low on South America crops

(Scott Bauer photo courtesy ARS/USDA)

Chicago | Reuters — U.S. soybean futures fell to a three-week low on Wednesday and posted a fourth straight daily decline on strong South American harvest prospects and a lack of supportive news, analysts said.

Corn and wheat futures closed higher as traders awaited direction from a U.S. Department of Agriculture forum this week in which the government will offer forecasts on what U.S. farmers will plant this spring.

Chicago Board of Trade March soybeans settled down 3-1/2 cents at $10.22-3/4 per bushel after dipping to $10.22-1/4, the contract’s lowest since Feb. 1 (all figures US$).

CBOT March corn ended up 1-3/4 cents at $3.71 a bushel and March wheat rose 5-1/4 cents at $4.41-1/4 a bushel.

Soybeans firmed in early moves but turned lower as traders mulled huge new soybean crops expected in South America. The harvest in Brazil was about 25 percent complete as of Friday, while Argentina’s crop is still developing.

“Rises today are being limited by the expected large soybean crops in South America,” said Graydon Chong, senior commodity analyst with Rabobank. “The market is closely watching the weather in Brazil and Argentina,” Chong said.

Also, U.S. farmers are expected to plant a record number of acres to soybeans this spring, USDA has said. The government is expected to release an updated forecast at its Outlook Forum this week.

Expectations of a year-on-year decline in U.S. corn plantings helped to underpin corn futures.

“Corn is trying to buy back some acres here,” said Terry Reilly, analyst with Futures International.

Strength in CBOT corn was limited in part by news from USDA that private exporters in the last day cancelled sales of 136,000 tonnes of optional-origin corn to South Korea.

Wheat rose on bargain-buying after a three-session decline, drawing additional support from a pickup in global export business.

Egypt’s General Authority for Supply Commodities (GASC) bought 300,000 tonnes of Russian wheat and 60,000 tonnes of Ukrainian wheat at an international tender. The deal followed a Feb. 17 GASC purchase of another 360,000 tonnes of wheat.

“Having Egypt in twice in one week is a bit supportive,” Reilly said.

— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Michael Hogan in Hamburg and Colin Packham in Sydney.

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