Chicago soy, grains retreat as technical selling unwinds crude-driven rally

BEIJING: Chicago soybeans, corn and wheat retreated from multi-year and multi-month highs on Tuesday, as traders booked profits, with technical selling reversing gains driven by higher crude prices in the previous session.

The most-active soybean contract on the Chicago Board of Trade (CBOT) fell 0.27% to $11.93 a bushel as of 0129 GMT. Soyoil lost 1.39% to 65.18 cents per pound.

“No doubt some profit taking has exacerbated losses to an extent given the recent surge in markets,” said Sean Hickey, an analyst at Bendigo Bank Agribusiness.

“Speculative traders are likely looking to reduce exposure given the uncertainty around what will happen next with the conflict in the Middle East.”

Oil prices fell on Tuesday after hitting a more than three-year high in the prior session as US President Donald Trump predicted the Middle East war could end soon, easing worries about prolonged disruptions to global oil supplies.

After speaking with Russian President Vladimir Putin on Monday, Trump said the United States will waive oil-related sanctions on “some countries” to tackle the shortage, which could mean a further easing of sanctions on Russian oil.

Grain markets often track crude because crops such as corn and soybeans are used in biofuel production and due to shifts in commodity fund flows.

Soybeans were also pressured by Brazil’s large crop and uncertainty over Chinese demand for US supplies, Hickey said.

Wheat dropped 1.78% to $5.92-1/2 a bushel, retreating from its highest level since June 2024 hit on Monday, while corn fell 1.1% to $4.48-3/4 a bushel, pulling back from a 10-month high.

Traders are awaiting the US Department of Agriculture’s monthly crop report due later in the day, which is expected to make only minor adjustments to its US and global supply forecasts.

The USDA is also expected to trim its outlook for soybean production in top exporter Brazil and raise Brazil’s corn harvest projection.