Chicago | Reuters — U.S. soybean futures rose on Monday after government data showed larger-than-expected export shipments of the beans and as rains slowed the early soy harvest in top producer Brazil, traders and analysts said.
Corn also was higher at the Chicago Board of Trade as bitter cold gripped much of the United States, supporting the cash market and stoking concerns about late spring plantings.
Brutal cold returned to the U.S. Midwest, complicating the movement of grain and livestock through the Farm Belt and threatening to damage winter wheat in a few areas, an agricultural meteorologist said.
Wheat futures pared early gains tied to the damage worries and finished lower in a technical selloff. Wheat is hovering near a 3-1/2-year low and soybeans a four-month low, hurt by plentiful global stockpiles.
CBOT March soybeans finished three cents higher at $12.87-3/4 per bushel, gaining for a second consecutive session (all figures US$).
CBOT March corn was up 2-1/4 cents at $4.31-3/4, the fifth straight day of higher prices.
U.S. soy export shipments last week of 73.8 million bushels topped the high end of analyst expectations ranging from 50 million to 58 million bushels, while shipments of wheat and corn fell within the range of trader estimates.
Traders watched so-called export inspections for signs that the source of soy shipments to top importer China was switching seasonally to South America from the U.S.
“Inspections are a little bigger than anticipated,” said Roy Huckabay, analyst at the Linn Group brokerage in Chicago.
Rains were forecast through Thursday in top Brazilian soy-growing state of Mato Grosso, delaying the already behind-schedule harvest.
Brazil is expected to produce a record 91.8 million-tonne soybean harvest, crop analysts Safras + Mercado said last week.
“I’m still a little negative” on soybean prices, Huckabay added. “We’re going to have a hard time absorbing the full harvest in South America.”
Corn weak, wheat firm
Corn futures hit the highest level in nearly two weeks, bolstered by a weather-related slowdown in grain movement with barge traffic reduced on icy Midwest rivers and some farmers staying off country roads due to heavy winds and drifting snows.
“Transportation has slowed dramatically,” said U.S. Commodities analyst Don Roose. “Feed consumption has a tendency to go up (during cold spells), and efficiencies go down. Usually what it means is an increase in consumption, and a slowdown in movement. It is usually a supportive factor, and it has been trying to give us a little support.”
The deep freeze in the Midwest could also leave soils too cold for spring plantings that can start in parts of the region as early as March.
CBOT March wheat eased 1-3/4 cents to $5.63-1/2 per bushel after earlier trading as high as $5.72-1/4.
“For wheat, very harsh and cold conditions continue in the U.S., raising concerns that the weather could damage the U.S. wheat crop,” said Vanessa Tan, investment analyst at Phillip Futures in Singapore.
Temperatures plunged to single digits below 0 F across the northern Midwest and Plains, and colder conditions are expected this week.
The boost to prices was limited by the fact any frost damage will not be fully known until wheat comes out of its dormancy period. Strong competition between major wheat exporters also weighed on prices, traders said.
“The weather is giving a bit of spice to the market but not everyone is reacting,” one trader said. “You can’t see at the moment what would really drive this market higher.”
News on Monday that Saudi Arabia had booked 715,000 tonnes of wheat, more than it had been seeking in its latest import tender, confirmed healthy export demand and could bring sales for U.S. wheat.
Buyers from top global wheat importer Egypt announced a tender seeking cargoes of the grain after the close of trading on Monday, the results of which will be released on Tuesday.
Egypt’s main wheat buying agency, the General Authority for Supply Commodities (GASC), earlier this month purchased its first U.S. wheat in nearly a year.
— Michael Hirtzer reports on the ag industry and futures markets for Reuters from Chicago.