U.S. grains: Soybeans end fractionally lower amid China trade woes

Corn pulls back on fair weather; wheat slips as U.S. harvest gets underway

CBOT July 2020 soybeans with 20- and 50-day moving averages. (Barchart)

Chicago | Reuters — U.S. soybean futures closed fractionally lower after a choppy session on Monday as brokers weighed pressure from rising U.S.-China trade tensions against news of fresh U.S. soybean sales to the Asian country, traders said.

Corn fell on an above-average planting pace and fair weather forecasts across the Midwest that should support crop prospects, while wheat declined as the U.S. harvest began.

The most-active soybean contract on the Chicago Board of Trade ended down 1/4 cent to settle at $8.40-1/2 a bushel (all figures US$).

CBOT corn fell 2-1/2 cents to $3.23-1/4 a bushel and CBOT wheat slipped 5-1/2 cents at $5.15-1/4 a bushel.

China, the world’s top soy buyer, told state-owned firms to halt purchases of soybeans and pork from the United States, two people familiar with the matter said, after Washington said it would eliminate special treatment for Hong Kong to punish Beijing.

“The fact that China may reduce or slow down imports of U.S. soybeans, pork or any ag product certainly does not bode well,” said Mark Schultz, chief analyst at Northstar Commodity.

However, Chinese state-owned firms bought at least three cargoes of U.S. soybeans for fall shipment from the Pacific Northwest, according to U.S. traders.

Meanwhile, warm, dry weather in the western half of the Corn Belt should benefit newly planted corn and soybeans, while persistent cool, wet conditions east of the Mississippi River bear watching.

“We really need warmer temperatures to dry the fields out, speed emergence of already-planted crops and finish seeding,” said Brian Hoops, senior market analyst at Midwest Market Solutions.

After the CBOT close, the U.S. Department of Agriculture said the U.S. corn crop was 93 per cent planted, just short of an average of analyst expectations for 94% but ahead of the five-year average of 89 per cent. USDA rated 74 per cent of the corn crop in good-to-excellent condition, up from 70 per cent a week ago.

USDA reported 75 per cent of soybeans planted, behind the average analyst estimate of 79 per cent, but ahead of the five-year average of 68 per cent.

Wheat futures slumped on reports of a strong start to the U.S. harvest in Texas and parts of Oklahoma, although drought concerns in Europe and Russia underpinned prices.

After the CBOT close, Egypt’s state wheat buyer set an international wheat purchase tender, its first since mid-April. Results were expected on Tuesday.

— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago; additional reporting by Nigel Hunt in London and Naveen Thukral in Singapore.

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