SINGAPORE: Chicago soybeans were little changed on Friday, with the market on track for a second weekly gain as a drought in Brazil, the world’s No. 1 exporter, supported prices despite ample supplies from newly harvested US crop entering the market.
Wheat prices climbed and were poised for a third weekly gain, while corn was almost flat. “Transport disruptions in Brazil due to the low water level in rivers and a lack of rains in supporting soybeans,” said one Singapore-based trader.
“The market is closely watching planting weather in Brazil.” The most-active soybean contract on the Chicago Board of Trade (CBOT) lost half a cent to $13.15 a bushel as of 0331 GMT. For the week, soybeans are up 2.7%.
Wheat gained 0.8% to $5.98-1/2 a bushel and corn was unchanged at $5.05 a bushel. For the week, wheat is up 3.2% and corn has added 2.4%.
A severe drought in Brazil is disrupting grain shipments and slowing soybean plantings, underpinning prices.
Some grain shipments on rivers in Northern Brazil have been halted due to the drought that has sent Amazon river tributaries to the lowest level in over a century, according to a note sent to clients on Thursday by shipping services provider Serveporto.
The El Nino weather phenomenon will last at least through the first half of 2024, according to the latest United Nations forecasts, with abnormal rainfall due across Latin America raising fears for the agricultural sector.
Soybeans hit 3-week high on strong demand, Brazil drought
Almost half of Argentina’s 2023/24 wheat crop is in fair to poor condition due to the lack of rainfall currently affecting core agricultural areas, the Buenos Aires Grain Exchange said on Thursday.
That is a 5 percentage point hike from its previous report.
However, the International Grains Council on Thursday raised its forecast for global wheat production in the 2023/24 season, with upward revisions for Ukraine, Russia and the United States outweighing a deteriorating outlook for the crop in Australia.
Expectations of a bumper corn harvest in the United States are likely to keep a lid on prices.
Commodity funds were net buyers of CBOT corn, wheat, soybean and soymeal futures contracts on Thursday, and net sellers of soyoil futures, traders said.
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