PARIS/NEW DELHI: Chicago soybeans fell for a second day on Monday, declining further from last week’s three-month high as investors feared more COVID-19 cases in China will dampen demand, while weekend rain in Argentina tempered concerns about a drought in the country, analysts said.
A steep fall in palm oil, following last week’s slide in soyoil, also dragged prices of the oilseed.
Wheat reversed losses from Friday to pull away from a one-year low struck last week, while Corn also ticked higher.
The most-active soybean contract on the Chicago Board of Trade (CBOT) was down 1.4% at $14.62-3/4 a bushel by 1144 GMT, to pull away from Thursday’s near three-month peak of $14.92-3/4.
The recent rally was spurred by US export sales to China, by far the world’s biggest soybean importer, and hopes that Beijing would loosen its strict policy on COVID.
But investor sentiment cooled as China faced an upturn in infections while it rolls back restrictions.
“China’s covid spread, even if it’s to get back to normal, is shutting stores and restaurants in the short term,” Michael Magdovitz, senior commodity analyst at Rabobank, said.
Soybeans near 3-month high, set for weekly gain on China demand hopes
Chinese hog futures extended a plunge on Monday as participants worried that coronavirus cases will dent meat demand in the run-up to the Lunar New Year holiday.
In South America, part of Argentina’s drought-hit farm belt received significant rainfall over the weekend, while in Brazil forecasts pointed to ample precipitation in the week ahead.
In US and world crop estimates on Friday, the US Department of Agriculture (USDA) raised slightly its projection of global soybean ending stocks and trimmed US biofuel demand for soyoil following lower-than-expected regulatory requirements that had sparked a slide in soyoil futures.
CBOT wheat climbed 1.9% to $7.48-1/2 a bushel after falling last week to its weakest since October 2021.
CBOT corn was up 0.7% at $6.48-3/4 a bushel.
News that the Ukrainian port of Odesa suspended operations on Sunday after Russian strikes on energy supply put attention back on risks to wartime grain shipments. The port resumed activity on Monday.
The USDA on Friday had increased its export forecasts for Ukrainian wheat and corn following last month’s extension of a Black Sea shipping corridor.