HAMBURG: Chicago soybeans fell on Monday, pressured by concern US sales to China could be endangered by political tension after the United States shot down a Chinese balloon.
Wheat was supported by strong international demand, especially a new tender from major importer Algeria.
Chicago Board of Trade most-active soybeans fell 0.5% to $15.24-1/4 a bushel at 1202 GMT. Wheat rose 0.2% to $7.58-1/4 a bushel, corn fell 0.4% $6.74-1/2 a bushel.
The United States is searching for remnants of what it believes was a Chinese surveillance balloon shot down over the Atlantic, and China says was a civilian craft that drifted astray.
“Soybeans and partly corn are being pushed down today by fears of geo-political tensions between the US and China after the US shot down the Chinese balloon over the weekend,” said Matt Ammermann, StoneX commodity risk manager. “Political tension is not good for new sales of soybeans or corn to China.”
“There is also the fear the Chinese government could order the cancellation of existing Chinese purchases of US soybeans and corn.”
“There is continuing background weakness for soybeans provided by the huge expected soybean crop in Brazil, although the harvest work is currently looking slow.”
Consultancy Safras & Mercado forecast a record Brazilian soybean crop. Advance Brazilian new crop sales rose slightly from last month but still tail last year.
“Corn is also suffering from the perception that it is too expensive compared to wheat, a factor which in turn is also supporting wheat,” Ammermann said. “Wheat is also being underpinned by some new purchase tenders in the market, especially from Algeria.”
Algeria issued two tenders each for a nominal 50,000 tonnes of soft milling wheat. South Korea’s Major Feedmill Group purchased about 65,000 tonnes of animal feed wheat in a private deal.
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