(Reuters) – U.S. corn and soybean futures rebounded on Thursday following a selloff in the prior session pinned on favorable weather that boosted hopes for a bountiful harvest in the fall.
The gains are likely to be fleeting though, analysts say.
“The U.S. near-term weather narrative remains decidedly bearish,” Commonwealth Bank of Australia analysts said in a note, citing forecasts of more rain in the U.S. Midwest.
“Forecasters have flagged that the southwestern Corn Belt will likely turn drier again after this week, but on balance U.S. crops are in very good shape,” they said.
Corn for December delivery on the Chicago Board of Trade gained 0.7 percent to $3.50-3/4 a bushel by 0214 GMT, after touching a contract low of $3.46 overnight.
CBOT soybeans gained 0.3 percent to $10.76-3/4 a bushel, having dropped to $10.40-1/2 on Wednesday, its weakest since May 25.
Expectations by weather forecasters that the onset of the La Nina weather pattern, which could trigger a dry summer in the U.S. Midwest, had been pushed back to September suggests that soybeans won’t get hit during their key development stage in August, CBA analysts said.
“The less threatening outlook will continue to weigh on the market,” they added.
The U.S. Department of Agriculture’s weekly conditions report on Tuesday showed strong ratings for corn, soybeans and wheat.
Chicago wheat rose 0.5 percent to $4.30-1/2 a bushel.
Black Sea wheat exporters Russia and Ukraine have started harvesting and are seeing higher yields and the same quality as a year ago, analysts and traders said.
