PARIS/SINGAPORE: US soybean futures turned lower on Friday, hitting a one-month low as a deepening trade dispute between the United States and China, respectively the world's biggest soybean producer and importer, triggered selling after a recent weather rally.
Traders and analysts do not expect US soybeans to be directly targeted in any Chinese riposte to US plans to impose tariffs on up to $60 billion of Chinese products, because of China's heavy reliance on soybean imports.
However, the growing tensions, with China issuing a list of US goods including pork that could be subject to extra duties in response to US tariffs, fuelled caution in the soybean market.
"It's a case of concern about whether these additional tariffs from Trump will result in retaliation from China," Charles Clack, a commodity analyst at Rabobank, said.
"On the soybean side, this is lowering confidence in the recent price strength in a market that has been popular with funds," he said.
"Fundamentally, our view is that in terms of retaliatory measures, soybeans is very difficult for China to do."
China is by far the world's biggest importer of soybeans and with drought slashing harvest prospects in No. 3 producer Argentina this year, China would struggle to replace US supplies.
The most-active soybean contract on the Chicago Board Of Trade was down 1.2 percent at $10.17-1/2 a bushel by 1133 GMT. It earlier fell as low as $10.12, its weakest since Feb. 16, after erasing a small gain at the start of the session.
CBOT wheat was down 1.5 percent at $4.49 a bushel and corn was down 1.1 percent at $3.71-3/4, with the cereals pressured by the pullback in soybeans and wider losses in equity and commodity markets.
Wheat also remained under pressure from rains that could help drought-hit US winter wheat crops as the crucial spring growth period begins.
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