Chicago | Reuters — U.S. soybean futures slid to their lowest level since June on the first trading day of the year, after rains hit dry areas of Brazil and forecasts called for more showers.
A rising dollar also weighed on agricultural markets as it makes U.S. farm products less attractive to importers. Corn set a contract low in front-month futures, and wheat futures also declined.
Favorable Brazilian rains dragged down soybean futures because the country is the world’s top supplier of the oilseed.
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“We did get improvement in weather,” said Don Roose, president of brokerage U.S. Commodities in Iowa.
“These dry areas shrunk. The forecast looks like we have more normalized weather for the next 10 days or so.”
Hot, dry weather has previously hurt crops in northern growing areas and spurred analysts to lower their harvest forecasts. Agribusiness consultancy StoneX on Tuesday cut its estimate for Brazil’s soy crop to 152.8 million metric ton from 161.9 million tons.
“Rains in northern areas are helping to slowly improve moisture and crop conditions,” forecaster Maxar said.
Traders also monitored crop weather in Argentina, where farmers made good progress sowing soybeans and corn following recent abundant rainfall.
Chicago Board of Trade March soybean futures SH24 ended down 24-1/2 cents at $12.73-1/2 a bushel and touched the lowest price since June 29.
March corn CH24 closed 7-1/2 cents lower at $4.63-3/4 per bushel after setting a contract low of $4.62-1/2. March wheat WH24, meanwhile, lost 21-1/4 cents to close at $6.06-3/4 per bushel at the CBOT.
Funds were net sellers of soybeans, corn and wheat futures.
After the markets closed, the U.S. Department of Agriculture said 6 million tons, or 200.1 million bushels, of soybeans were crushed in November. Analysts had expected 5.991 million tons, or 199.7 million bushels.
Grain traders also continued to monitor risks in the Red Sea and Ukraine, a major crop exporter.
