CANBERRA/PARIS: Chicago soybean futures on Monday fell below USD11 a bushel for the first time since October amid uncertainty over whether China will buy as much US supply as Washington expects and as traders awaited direction from US grain forecasts and an interest rate decision.
Corn and wheat inched up, supported by US Department of Agriculture projections on Friday that American farmers will plant less of the cereals next year and shift some area towards soybeans.
Price moves were limited with traders awaiting the USDA’s monthly supply and demand report, as well as a US Federal Reserve interest rate decision that could weigh on commodities via swings in the dollar.
“The coming week looks busy, with the USDA’s December report due tomorrow and the Fed’s rate decision on Wednesday,” CM Navigator analyst Donatas Jankauskas said.
The most-active soybean contract on the Chicago Board of Trade (CBOT) was down 0.6 percent at USD10.98-1/4 a bushel at 1226 GMT after touching USD10.95-1/4, its lowest since October 30.
Soybeans have fallen from a 17-month high of USD11.69-1/2 last month after a trade truce between Washington and Beijing renewed Chinese purchases of US soy.
The pace of Chinese buying has underwhelmed traders. Including Friday’s announcement of a sale of 462,000 metric tons, total US soybean sales to China since the truce have reached about 2.7 million tons, compared with a target of 12 million tons cited by US officials.
However, some see scope for Chinese buying to accelerate.
Analysts at Citi said they expected China to purchase 10 million tons by year-end, while traders said news that China’s state stockpiler Sinograin will auction 512,500 metric tons of imported soybeans on Thursday - its first such sale in three months - may suggest it is preparing for arrivals of US beans.
The soybean market is also watching to see if the US administration unveils on Monday, as reported by Bloomberg, a promised aid package for farmers hit by low crop prices and Washington’s trade standoff with China this year.
CBOT wheat ticked up 0.3 percent to USD5.37-1/2 a bushel and CBOT corn inched 0.1 percent higher to USD4.45-1/4 a bushel as the cereal markets assessed ample global supply and steady export demand.
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