Chicago | Reuters — Chicago grain futures struggled to gain any traction on Tuesday, with wheat rising slightly on technical buying and soybeans slipping as traders anxiously awaited more news on the U.S.-China trade talks.
Corn futures inched up late in the trading session, finding support on planting concerns and technical buying, traders said.
“Corn is the rope in the trading tug of war between wheat and soybeans,” said Ted Seifried, chief ag market strategist of the Zaner Group.
“We already know all the negative news that’s out there for wheat, and we’re now at a place where wheat is very oversold,” Seifried said.
Soybean futures were the weakest commodity in the grains complex with the backdrop of an uncertain outcome of the trade talks and unanswered questions about when the Chinese market will reopen to U.S. soybeans.
“For soybeans, there really needs to be a daily bit of positive trade news to see any movement,” Seifried said.
China’s commerce minister said trade talks with the U.S. have been difficult but working teams from both countries are continuing negotiations. Markets were previously supported by reports on Sunday saying the U.S. and China appeared close to a deal.
But then on Tuesday, uncertainty returned: U.S. President Donald Trump will reject a U.S.-China trade deal that is not perfect, U.S. Secretary of State Mike Pompeo said in a media interview.
If that happened, the United States would still keep working on an agreement, Pompeo told Sinclair Broadcasting Group, according to a transcript released by the State Department.
On the positive side, soybeans found some support from news that a canola cargo from Canada has been blocked from entry into China because of trade issues, traders said.
“This could open the door for additional U.S. business,” said Karl Setzer, operations manager for Citizens LLC, a U.S. grain elevator company, in an analyst note Tuesday. “Transit issues in Brazil are also raising hopes of more U.S. exports.”
Chicago Board of Trade most active May soybeans ended the day down 2-1/4 cents at $9.13-3/4 a bushel on Tuesday. May corn settled up one cent at $3.75-3/4 a bushel, while May wheat settled up 7-1/4 cents at $4.62-3/4 a bushel.
Wheat remains under pressure as U.S. supplies seek a price level that will enable exports against intense competition from the Black Sea and Western Europe. Australia’s wheat harvest is expected to jump 38 per cent if farms receive rain.
One possible opportunity for wheat, said traders: Egypt, the world’s largest wheat importer, has rejected a shipment of Romanian wheat over a “quality issue,” an official with knowledge of the matter told Reuters.
A trade source with knowledge of the matter said the shipment was rejected because of an issue with its falling number, the internationally standardized and most popular method for determining sprout damage and so the milling quality of wheat.
— P.J. Huffstutter reports on agriculture and agribusiness for Reuters from Chicago; additional reporting by Michael Hogan in Hamburg and Colin Packham in Sydney.