Chicago | Reuters — U.S. corn and wheat futures jumped on Monday to their highest levels in over a month on technical buying as well as concerns about rain stalling the country’s autumn harvests.
Soybean futures slumped as China — the world’s top buyer of the oilseed — and the U.S. imposed fresh tariffs on each other’s goods as part of an escalating trade war.
The soybean market is particularly exposed to the dispute because the oilseed is the biggest U.S. agricultural export to China. Shipments have nearly dried up since Beijing applied an additional tariff on U.S. beans in July.
The slowdown comes as U.S. farmers are starting to bring in massive corn and soybean crops from their fields.
Corn was 16 per cent harvested as of Sunday, in line with analysts’ expectations, according to U.S. Department of Agriculture data. The soy harvest was 14 per cent complete, compared to expectations for 13 per cent.
Rains expected to hamper the harvest this week could put crops at risk for damage from bad weather, said Brian Hoops, president of U.S. broker Midwest Market Solutions.
“Any lack of progress I think will be supportive to the corn market,” Hoops said. “Once that crop is ready to be harvested, if you leave it out in the field bad things can happen to it.”
Front-month corn futures at the Chicago Board of Trade (CBOT) rose 0.9 per cent to $3.60-1/2 a bushel (all figures US$). The market earlier on Monday touched $3.62 a bushel – the highest price for a nearby contract since Aug. 21.
Solid demand helped support gains.
USDA on Monday reported that 1.3 million tonnes of U.S. corn were inspected for export in the week ended Sept. 20, topping analysts’ estimates.
Wheat inspections totaled 409,592 tonnes and soybean inspections were at 693,890 tonnes, according to the USDA, within analysts’ estimates.
Front-month CBOT wheat futures ended up one per cent at $5.27 a bushel after reaching $5.31-1/4, a one-month high for front-month wheat.
Soybeans slipped 0.7 per cent, to $8.41 a bushel.
“What’s weighing on things is the new Chinese tariffs that went into effect,” Hoops said of soybeans. “That uncertainty about future exports is limiting any upside mobility of our soy complex.”
China decided not to send Vice-Premier Liu He to Washington this week, the Wall Street Journal reported last week. A senior White House official said the United States does not yet have a scheduled date to announce another round of talks.
— Tom Polansek reports on agriculture and agribusiness for Reuters from Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.