CANBERRA/PARIS: Chicago soybean futures dipped on Wednesday as rain in top exporter Brazil eased supply fears and a stronger dollar made US agricultural commodities less attractive to foreign buyers.
Wheat and corn futures were also lower after a steep drop on Tuesday.
The most-active soybean contract on the Chicago Board of Trade (CBOT) was down 0.2% at $12.71-1/2 a bushel by 1242 GMT after slipping nearly 2% on Tuesday to its lowest levels since Oct. 12.
Wheat extended its losses to a one-month low of $6.02, after a 3.4% slump in the previous session, while corn was down 0.2% at $4.62-3/4 a bushel after slipping 1.6% on Tuesday.
Corn faces biggest annual loss in a decade; wheat, soybeans down
The US dollar rose again on Wednesday after jumping the previous day, underpinned by elevated US Treasury yields and a cautious turn that weighed on Wall Street.
Rains in northern Brazil – the world’s largest soybean producer – are helping slowly improve moisture and crop conditions, and are expected to remain “very active” this week, forecaster Maxar said.
Lack of rain has already taken a toll on yields, with brokers StoneX cutting the estimate for the country’s 2023/24 soybean crop by 9.1 million metric tons to 152.8 million tons.
However, higher supply from other South American producers is likely to offset losses in Brazil, said StoneX analyst Arlan Suderman.
“Buyers have not yet seen the need to increase imports of US soybeans to compensate for a ‘short’ Brazil crop,” Suderman said.
“Part of the reason for that has been expectations for the Argentine crop to nearly double this year to close to 50 million metric tons, while increased production is also expected in Paraguay and Uruguay.”
StoneX reduced its forecast for Brazil’s 2023/24 corn production by 1.4 million metric tons to 124.6 million tons.
Speculators have entered 2024 with some of their most bearish-ever views towards CBOT corn, but in years past, that positioning has rarely proven sustainable.
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