Soybeans fall as news of US/China trade deal awaited
HAMBURG: Chicago soybeans fell on Tuesday as dealers awaited more news on a trade agreement to reopen China's huge soybean market to U.S. exports.
Wheat also fell, while corn was little changed.
"Soybeans and corn markets are today awaiting signs of more progress in the U.S./China trade talks," said Michael Magdovitz, senior agriculture commodities analyst at Rabobank. "The markets remain in limbo with no concrete news about broader trade progress or a 'soybean solution' that would reopen the Chinese market to U.S. soybeans."
Chicago Board of Trade Most active May soybeans were down 0.2 percent at $9.13-1/2 a bushel at 1204 GMT, after rising 0.5 percent on Monday.
May corn fell 0.07 percent to $3.74-1/2 a bushel after also rising 0.5 percent on Monday. May wheat fell 0.3 percent to $4.53-1/2 a bushel.
China's commerce minister said trade talks with the United States have been difficult but working teams from both countries are continuing negotiations. Markets were previously supported by reports on Sunday saying the United States and China appeared close to a deal.
"China said a couple of weeks ago it would buy around 10 million tonnes of U.S. soybeans, but no purchases have been reported yet," Magdovitz said. "President Trump asked China to unilaterally remove tariffs on U.S. farm products and the market is waiting for its response."
"U.S. farmers hold record soybean stocks and must soon make decisions about what crops they will plant for the new harvest. Unless we see more news of progress in the China trade talks they may start selling these inventories more aggressively."
Corn futures have been receiving support on worry about U.S. weather, planting concerns and technical buying, brokerage Allendale added.
Wheat remains under pressure as U.S. supplies seek a price level which will enable exports against intense competition from the Black Sea and west Europe. Australia's wheat harvest is expected to jump 38 percent if farms receive rain.
"Wheat has been falling as U.S. wheat needed to gain export competitiveness," Magdovitz said. "But there are signs that recent declines have made U.S. wheat competitive in export markets, with U.S. wheat offered cheapest in Iraq's international tender on Monday."
"Wheat discounts are also bringing out international buyers, which could in turn support prices. We could see a wheat price consolidation if the market assesses that U.S. wheat has fallen to levels which will enable more export sales to be made."