Chicago | Reuters — U.S. grain and soybean futures closed lower on Thursday, with profit-taking dragging wheat down from two-month highs, traders said.
Broad-based selling added pressure on prices as traders reduced their risk amid growing warnings of a global economic slowdown, analysts said.
“Inflation and recession concerns hit all markets today,” CHS Hedging said.
Most-active Chicago Board of Trade wheat futures settled down 27-1/4 cents at $8.45 a bushel (all figures US$). The market earlier reached its highest level since July 11 at $8.84-3/4. K.C. wheat also closed lower after reaching a two-month high.
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A tentative agreement to avoid a U.S. rail shutdown weighed on wheat futures, said Matt Wiegand, a risk management consultant and commodity broker at FuturesOne.
Before the deal, some traders thought a shutdown could increase demand in the U.S. Plains for locally produced wheat for livestock feed because railroads would be unable to transport corn for feed, Wiegand said.
“The big thing is wheat today, with the rail strike being averted,” he said.
In other markets, CBOT corn ended 4-3/4 cents lower at $6.77-1/2 a bushel, while soybeans slid 3-1/2 cents to settle at $14.51-1/2 a bushel.
Accelerating U.S. harvests hung over the corn and soy markets, with warm and dry weather benefiting fieldwork and the end of crop development, traders said.
The U.S. Department of Agriculture issued four weeks’ worth of weekly U.S. export sales data, after suspending reports due to problems with a new reporting system.
Argentine soybeans are cramping U.S. export business this month after Buenos Aires incentivized soy sales through a favourable exchange rate.
Argentine farmer selling, along with broad commodity selling, will be headwinds to rallies in CBOT soybeans, CHS Hedging said. Argentina is also suffering dryness that is stalling corn plantings, experts said.
Separately, the U.S. soybean crush dropped by nearly three per cent in August, while soyoil stocks at the end of the month hit a 14-month low, according to National Oilseed Processors Association (NOPA) data.
— Reporting for Reuters by Tom Polansek in Chicago, Enrico Dela Cruz in Manila and Sybille de La Hamaide in Paris.
