SINGAPORE: Chicago soybeans rose for a second session on Thursday to hit a two-month high, as excessive rains in Argentina raised worries over supplies and triggered short covering.
Wheat rose for a third session in four and corn bounced back. “Beans seem to be the main driver at the moment because of Argentina’s storms,” said Andrey Sizov, managing director at agricultural consultancy SovEcon. “The funds were already in short-covering mode and the weather disruption seemed to speed things up substantially. Looks like some funds were caught off guard.”
The most-active soybean contract on the Chicago Board of Trade (CBOT) was up 0.9% at $12.20-3/4 a bushel, as of 0316 GMT, after climbing to its highest since Jan. 26 at $12.26-3/4 a bushel, earlier in the session. Wheat gained 1% to $5.50-1/2 a bushel and corn climbed 1.3% to $4.44-3/4 a bushel.
A new front of heavy rains over key grains regions of Argentina could be “very damaging” to the South American country’s current soybean and corn crops and could dent production, a local grains exchange and a weather expert said on Wednesday.
Traders are also covering short positions, analysts said, ahead of the US March 28 Prospective Plantings and quarterly stocks reports, which have a history of jolting markets.
Commodity funds were net buyers of CBOT soybean, soymeal, soyoil and corn futures contracts on Wednesday and net sellers of wheat futures, traders said.
Funds hold sizable net short positions in soybean, corn and wheat futures, priming markets for bouts of short-covering. There was additional support for soybeans stemming from private sales of 120,000 metric tons of US soybeans to undisclosed destinations, the first such announcement since Feb. 27.
Grain trade association Coceral on Wednesday cut its forecast for this year’s soft wheat output in the European Union and Britain by 5.4 million metric tons due to damage caused by heavy rainfall in the region.
Brazil extended its dominance over the United States as the largest corn supplier to China in the first two months of the year and also raised its soybean exports, Chinese customs data showed on Wednesday. China imported 4.1 million metric tons of corn from Brazil of a total 6.19 million tons that arrived during the January-February period, data from the General Administration of Customs showed, marking a 178% jump from a year ago.
Comments
Comments are closed.