PARIS/SINGAPORE: Chicago soybean prices ticked up on Wednesday to hold close to a two-week high, as investors cautiously welcomed news that US and Chinese officials agreed on a framework to preserve a truce in their countries’ trade war.
Corn and wheat also edged higher, with corn moving away from a six-month low and wheat from a near two-week low on Tuesday, though favourable US and global production prospects continued to curb the cereal markets. Price moves were limited, with traders awaiting more details on the outcome of the US-Chinese talks and watching for US inflation data later on Wednesday. Grain markets are also turning their attention to monthly US Department of Agriculture world crop forecasts on Thursday.
The most-active soybean contract on the Chicago Board of Trade (CBOT) was up 0.2% at $10.59-3/4 per bushel by 1050 GMT, near Tuesday’s peak that was the highest since May 28. “The soybean market has stabilised. We’re going to have to wait to see what happens next in the trade talks,” Argus Media analyst Maxence Devillers said.
China is the world’s biggest soybean importer, while the United States is the No. 2 exporter of the oilseed. Chinese retaliatory tariffs on US agricultural goods have curbed soybean trade, with Brazil dominating record Chinese soybean imports in May.
After a bumper Brazilian harvest, a good start to the US growing season was also hanging over the soybean market.
In cereals, CBOT wheat added 0.2% to $5.35-3/4 a bushel, after slipping to its lowest since May 29 on Tuesday, while corn gained 0.7% to $4.42 a bushel after reaching its weakest level since Dec. 5 in the previous session. Wheat prices came under pressure after the US Department of Agriculture raised its ratings for both spring and winter wheat crops, tempering concerns about rain damage in the run-up to harvesting. Supply prospects have also been bolstered by a satisfactory crop outlook in top wheat exporter Russia.
“There’s not much to make prices rebound at the moment when you look at fundamentals, the crop outlook is decent,” Devillers said of wheat.
In corn, brisk US exports were lending some support, but the feed grain market was also pressured by favourable crop conditions in both the United States and Brazil.
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