U.S. grains: Soybeans hit three-week low

(Photo courtesy United Soybean Board)

Chicago | Reuters — U.S. soybean futures closed lower on Tuesday for a third straight session, reversing from early strength to touch a three-week low on expectations for large South American soy harvests, analysts said.

Wheat futures fell while corn firmed, supported by export demand and technical buying.

Chicago Board of Trade March soybean futures settled down 6-1/4 cents at $10.26-1/4 per bushel after dipping to $10.26, the contract’s lowest since Feb. 1 (all figures US$).

Early support in soybeans stemmed from fears that heavy weekend rains in Argentina could threaten yield prospects, but local weather analysts said the moisture was probably beneficial for crops. Favourable weather in Brazil, which is forecast to harvest a record-large soybean crop, added to bearish sentiment.

“Brazilian output will easily make up for any shortfall in acreage caused by early Argentine rains, and even that crop is said to be rebounding impressively after the wet start,” INTL FCStone analyst Matt Zeller said in a note to clients.

Wheat also posted a third straight decline, with the March contract down five cents at $4.36 a bushel.

A stronger dollar added pressure, making U.S. wheat less attractive on the global market. The dollar gained on market expectations that the Federal Reserve might raise benchmark U.S. interest rates in March.

However, weekly export data from the U.S. Department of Agriculture was supportive. The government reported export inspections of U.S. wheat in the latest week at 558,252 tonnes, topping a range of trade expectations for 350,000 to 550,000 tonnes.

Corn turned higher after a choppy start, supported by technical buying and fresh export demand. CBOT March corn finished up one cent at $3.69-1/4 a bushel, finding chart support at its 200-day moving average.

USDA said private exporters in the last day sold 111,200 tonnes of U.S. corn to unknown destinations.

Traders were looking to acreage forecasts from USDA’s annual outlook forum this week to gauge an expected drop in U.S. wheat sowings and a shift from corn toward soybeans.

— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Gus Trompiz in Paris.

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