Soybeans, corn slide on US crop weather; wheat firms

CHICAGO: US soybean futures fell about 2 percent on Thursday, with the new-crop November contract dropping below psychological support at $10 a bushel, on favorable crop weather and fund-driven long liquidation, analysts said.

Corn futures followed soybeans lower while wheat rose, supported by poor weather in several global production areas that threatens to tighten world stockpiles.

Chicago Board of Trade July soybeans settled down 20 cents at $9.74-1/4 per bushel and new-crop November, representing the newly planted US crop, ended down 18-3/4 cents at $9.94-3/4 a bushel.

CBOT July corn fell 2 cents to $3.76-1/4 a bushel while July wheat rose 7 cents to $5.26-3/4 a bushel.

Soybeans and corn sagged as forecasts for beneficial rains in the US Midwest through early next week bolstered production prospects. Crops are already off to a good start, with the US Department of Agriculture this week rating 75 percent of the US soybean crop and 78 percent of the corn in good to excellent condition.

"Everyone is going to catch some rain here. It certainly takes some drought risk off the table as you get into July and August," said Joe Vaclavik, president of Standard Grain, a brokerage.

"You've also got a big fund long in the market that appears to be liquidating," Vaclavik added.

Soybeans faced additional pressure from weakness in the Brazilian real, which may encourage Brazilian farmers to sell more of their record-large 2018-2019 soybean harvest.

The Brazilian currency's devaluation versus the dollar boosts returns in farmers' local currency. The real hit a two-year low on concerns over the nation's fiscal outlook.

Brazilian growers have so far sold 73 percent of the 2017-18 soy crop, far ahead of sales at this period last season, agricultural consultancy Datagro said Wednesday.

Uncertainty about US trade relationships with China and other countries hung over the grain market as well. Traders awaited news of an offer by China to import an extra $70 billion of American goods over a year, which on Tuesday had raised hopes of progress in trade negotiations.

Wheat futures bucked the weak trend, advancing as dry weather in leading exporting countries kept investors nervous about supply snags for the coming season.

"It is pretty dry in Australia, although yields will depend on how June rainfall goes. Dryness in Russia is a real concern, as the Black Sea region has emerged as such a big exporter, and buyers around the world are dependent on wheat from Russia and Ukraine," said Phin Ziebell, agribusiness economist at National Australia Bank.