Chicago | Reuters — Chicago soybean futures climbed on Wednesday to a three-week high as fresh export demand from China, the world’s top importer, continued to support prices.
Wheat prices bounced after a two-day slide, with a softer U.S. dollar lending support, while corn ended narrowly mixed.
Chicago Board of Trade July soybeans settled up seven cents at $8.57-1/2 a bushel, after reaching a three-week high of $8.58. CBOT July wheat rose four cents to $5.12 a bushel (all figures US$). Nearby July corn eased 1/4 cent to $3.24 a bushel while new-crop December ended up 1/4 cent at $3.38-1/4.
The U.S. Department of Agriculture confirmed sales of 186,000 tonnes of U.S. soybeans to unknown destinations, which analysts said likely meant China. The sale’s destination was initially listed by USDA as China before the agency issued a correction.
A spate of U.S. soy sales this week eased concerns about export demand after Beijing reportedly told importers to halt purchases following a dispute over a new Chinese security law for Hong Kong.
Recent currency moves have favoured U.S. soy, with Brazil’s real currency recovering from a prolonged slide while the dollar has softened, making U.S. products more competitive.
“The value of the U.S. dollar is playing into the Chinese trade plan, and now that the dollar is coming down, we’re seeing them act as they said they would,” said Dan Hussey, senior market strategist for Zaner Group.
Corn futures were little changed. Weather outlooks were favourable in the Midwest crop belt, while demand for corn-based ethanol remained lethargic. Ethanol consumption missed analysts’ predictions despite five weeks of increased production and a decrease in stocks, analysts said.
The U.S. Energy Information Administration said production of corn-based ethanol increased by 41,000 barrels per day in the latest week, while ethanol stocks fell.
“The improvement in ethanol consumption fell short of expectations… But it’s still going in the right direction,” said Terry Reilly, senior analyst with Futures International.
— Reporting for Reuters by Christopher Walljasper in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.