Wheat nears 2-week low on export worries; soy, corn also slide

CHICAGO: US wheat futures fell about 1 percent on Tuesday to their lowest in nearly two weeks on worries about a slow pace of export business, traders said.

Soybean and corn futures declined on concerns over US-China trade tensions ahead of talks this week in Washington.

Chicago Board of Trade March wheat settled down 5-1/2 cents at $5.13-1/4 per bushel after dipping to $5.10-3/4, its lowest since Jan. 17.

CBOT March soybeans ended down 4-1/4 cents at $9.19 a bushel and March corn fell 2-1/2 cents at $3.77-3/4 a bushel.

Wheat posted the biggest declines on a percentage basis as the CBOT March contract dropped below support at its 20- and 50-day moving averages, attracting technical selling.

Top global importer Egypt bought 360,000 tonnes of wheat in an international tender, including its first purchase of French wheat since 2017. Two cargoes of US wheat were offered, including one at the lowest price in the tender when freight costs were excluded.

But adding freight costs made wheat from other origins more attractive.

"Once again we had two of the three lowest offers, and no business," said Tom Fritz, a partner with EFG Group in Chicago.

The market appeared to shrug at frigid temperatures in the US Midwest through Thursday that could threaten dormant winter wheat. Readings were expected to fall below zero degrees Fahrenheit (minus 18 Celsius) as far south as southern Illinois, Indiana and Ohio, where protective snow cover is lacking.

"We're going to lose some wheat here," said Jack Scoville, vice president of Price Futures Group in Chicago. "We should have a short crop anyway because I'm pretty sure we didn't get everything planted (last autumn)," Scoville said.

Soybeans and corn futures sagged as traders awaited news from this week's trade negotiations.

"We're in a risk-off mode, with the China-US talks starting up," Scoville said.

US Treasury Secretary Steven Mnuchin said the United States expects to make significant progress in the talks with Chinese Vice Premier Liu He, who will later see President Donald Trump.

But there is concern the talks could be threatened by the United States announcing criminal charges against Chinese telecoms group Huawei.

"If you read all the rhetoric, it suggests to me that the US is not going to get everything they want ... It's cast a negative pall over the market," Fritz said.

Following the partial US government shutdown, the US Department of Agriculture plans to release several key grain reports on Feb. 8.

The US Commodity Futures Trading Commission said it will stagger the release of weekly Commitments of Traders reports delayed by the shutdown, with the first report to be issued on Friday.