US soyabean futures dropped 1.5 percent on Friday, reversing a 2 percent rise a day earlier on worries about slowing US soya export demand and a rebound in the dollar. The US dollar index firmed on investor scepticism over details of the euro zone deal reached Thursday.
The currency move pressured crude oil futures and other dollar-denominated commodities. The Reuters-Jefferies CRB commodity index was down about 0.3 percent, setting back from a one-month high posted on Thursday. Corn and wheat futures posted modest advances, with corn notching its fourth straight weekly gain and wheat up for the third week in a row.
Unwinding of soya/corn and soya/wheat spreads lent support to grains at the expense of the oilseed. Slow farmer selling and firm cash markets also supported corn. CBOT January soyabeans settled down 18 cents at $12.26 per bushel. December wheat ended up 1/2 cent at $6.44-1/2 and December corn was up 3-1/2 cents at $6.55.
December corn closed above its key 200-day moving average of $6.51-1/4, a bullish technical close, setting the stage for potential further gains when Globex trading resumes on Monday. Wheat was up 2 percent for the week, corn up 0.9 percent and soyabeans up 0.4 percent.
Weak US export demand pressured soyabeans, as did mounting competition from South America, where planting is off to a favourable start. "They are expecting to see the crop going into the ground really smoothly," said Dewey Strickler, president of AgWatch Market Advisors.
The US Department of Agriculture on Thursday reported the smallest weekly export sales figure for US soyabeans in four months. USDA has projected that US soyabean export sales in 2011/12 will drop 8.3 percent from the previous year, but sales are down 18 percent in the marketing year to date. "Yesterday we were caught up on the overall buying because of the EU debt news, and we ignored the lousy export sales. Today it looks like that is catching up to them," said Citigroup oilseed analyst Mario Balletto.
US soya exports have struggled this fall, normally the strongest period for the world's top exporter, due to stiff competition from South American suppliers who are flush with soyabeans from bumper crops. Soyabeans were also pressured by trade expectations that 200 to 500 contracts would be delivered against November futures on first notice day on Monday, after several delivery periods with few postings amid tight supplies. Firm US cash markets were supporting corn. US farmers have been reluctant to sell newly harvested corn following a drop in prices last month, in the wake of historically high prices this past summer.
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