U.S. grains: Soybeans drop on rainy U.S. Midwest outlook

Chicago | Reuters — U.S. soybean futures fell 1.5 per cent on Tuesday, pressured by concerns about cooling demand from top importer China and forecasts for rain in the U.S. Midwest at a key point in the crop’s development.

Corn firmed as a weekly U.S. Department of Agriculture report showed a slight decline in the crop’s condition, while wheat futures declined on weak demand and plentiful global supplies.

Overall, price movements were restrained as grain markets awaited more indications on corn and soybean yields from this week’s Pro Farmer Midwest crop tour that started on Monday.

Chicago Board of Trade November soybeans fell 12-3/4 cents, or 1.5 per cent, to $9.04-1/4 a bushel after earlier coming within a penny of a two-month low (all figures US$).

Overall ratings for U.S. soybean crops were unchanged on the week with 63 per cent considered good or excellent, USDA said Monday.

Weather forecasts for the U.S. are predicting widespread rain in the coming week, which should help soy crops in dry parts of the Midwest.

“August is when you make the beans. Some of the areas were in need of some rain, even the good areas, and we are getting it,” said Don Roose, president of U.S. Commodities.

A sharp drop in Chinese share prices dented market sentiment, stoking concerns about a slowing economy in the world’s top commodities importer and No. 1 soy buyer.

CBOT December corn rose 2-3/4 cents, or 0.7 per cent, to $3.77-1/4 a bushel, drawing support from a fall in USDA’s good-to-excellent crop rating to 69 per cent, down one point from the previous week.

Spread trades involving long corn positions and short soybeans and wheat added support.

Crop scouts on the first day of the Pro Farmer Midwest crop tour found below-average yield potential in Ohio on Monday and strong prospects in South Dakota.

The four-day tour will release its findings for Indiana and Nebraska on Tuesday. Early field reports indicate surprisingly strong corn and soybean yield potential in central and north-central Indiana and above average yield potential in southeastern Nebraska.

CBOT September soft red winter wheat fell 6-1/4 cents, or 1.1 per cent, to $4.94-1/4 a bushel. September hard red winter wheat shed 6-1/4 cents, or 1.1 per cent, to $4.76 a bushel.

Karl Plume reports on ag commodity markets for Reuters from Chicago. Additional reporting for Reuters by Gus Trompiz in Paris, Naveen Thukral in Singapore and Julie Ingwersen in Chicago.

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