U.S. grains: Soy down on profit-taking after climb above US$10

CBOT corn, wheat also down

CBOT November 2020 soybeans with Bollinger (20,2) bands. (Barchart)

Chicago | Reuters — U.S. soybean futures fell on Tuesday, retreating from two-year highs above US$10 a bushel as traders booked profits and forecasts called for favourable weather for the start of the U.S. Midwest harvest, analysts said.

Corn futures backed down from six-month highs set a day earlier, and wheat also declined.

Chicago Board of Trade November soybeans settled down eight cents at $9.91-1/2 per bushel, a day after touching $10.08-3/4, the highest for a most-active contract since June 2018 (all figures US$). Technical selling accelerated as the November contract fell below Monday’s low of $9.96.

CBOT December corn ended down 3-1/2 cents at $3.66 a bushel and December wheat fell 7-1/2 cents to settle at $5.38-1/4 a bushel.

Industry data showing a lighter-than-expected U.S. soybean crushing pace added to bearish sentiment. The National Oilseed Processors Association (NOPA) said its members, which handle about 95 per cent of all soybeans crushed in the United States, processed 165.055 million bushels of the oilseed in August, a nine-month low that fell below the average trade estimate of 169.5 million.

Meanwhile, dry weather expected in Midwest should help jump-start the harvest of large U.S. corn and soybean crops.

“The negative sentiment was already in the market prior to the NOPA crush report,” said Terry Reilly, senior analyst with Futures International in Chicago. “Overall, U.S. weather looks fantastic,” Reilly said.

Export demand helped underpin futures. The U.S. Department of Agriculture on Tuesday confirmed sales of 132,000 tonnes of U.S. soybeans to China, along with sales of soybeans and corn to unknown destinations.

Soybean futures in particular appeared due for a pullback after the CBOT November contract rose in 14 of the last 15 trading sessions.

Traders shrugged off declines in U.S. corn and soy condition ratings as crops approach maturity. USDA late Monday rated 60 per cent of U.S. corn in good-to-excellent condition, down from 61 per cent last week, and 63 per cent of U.S. soybeans as good-to-excellent, down from 65 per cent previously.

CBOT wheat fell as traders noted strong competition for export business. After the CBOT close, Egypt’s main state wheat buyer set an international wheat purchase tender, with results expected Wednesday.

Egypt has bought Russian-origin wheat at its last four tenders.

— Julie Ingwersen is a Reuters commodities correspondent in Chicago; additional reporting by Michael Hogan in Hamburg and Naveen Thukral in Singapore.

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