Chicago | Reuters — U.S. soybean futures climbed for a fourth straight session on Thursday to the highest in nearly two weeks on concerns that dry conditions in Argentina could reduce the soybean crop and scale back soymeal supplies.
Wheat futures rose on short-covering and a weakening U.S. dollar, while corn drifted lower on technical and commercial selling.
Soymeal futures gained the most as traders monitored weather in Argentina, the world’s top soy product supplier and where parts of the crop belt have experienced a very dry start to the growing season.
Some areas have received rain this week, but analysts say more is needed to prevent yield losses.
“Fundamentally the market is being supported by concerns about Argentina’s soybean crop,” said Brian Hoops, president of Midwest Market Solutions.
“There’s a little bit of a concern from (soymeal) end-users and they want to get some coverage in case things remain dry there. That has really spurred a rally in soybean meal and has spilled over into soybeans,” he said.
Chicago Board of Trade March soybeans gained 4-1/4 cents to $9.73 a bushel (all figures US$). March soymeal was up $4.10 a ton at $328.40, the highest since Dec. 14.
Chicago wheat rose for a second straight session as a weak dollar spurred hopes of renewed export demand and as investors assessed whether well-supplied grain markets have bottomed out.
The International Grains Council (IGC) raised its forecast for global wheat production in the 2017-18 season but said global wheat stocks in 2018-19 could decline for the first time in six years.
The dollar slumped to a three-year low against a basket of currencies on Thursday. A weak greenback makes dollar-denominated grains more affordable to those holding other currencies.
An update on export demand from weekly U.S. export sales figures is due on Friday.
CBOT March wheat rose 3-3/4 cents to $4.25-1/4 a bushel.
Corn retreated as follow-through buying after Wednesday’s two-week high faded, triggering technical selling. An increase in cash grain sales by farmers also fueled commercial selling in futures as elevators and processors hedged their new physical long positions.
The market remains under pressure from ample domestic and world supplies as the IGC raised its forecast for 2017-18 global corn production.
CBOT March corn dipped 1-1/2 cents to $3.51-1/2 a bushel after briefly trading above its 50-day moving average, a technical level the market has struggled to breach for three months.
— Karl Plume reports on agriculture and agribusiness for Reuters from Chicago; additional reporting by Naveen Thukral in Singapore and Gus Trompiz in Paris.