(Reuters) – U.S. soybean futures fell to a three-month low on Thursday as improving crop conditions in South America and weakness in vegetable oil markets exerted downward pressure on prices.
The Chicago Board of Trade’s most-active soybean contract fell 0.1 percent to $9.52-3/4 per bushel by 1138 GMT after setting a three-month low of $9.52.
“Soybeans remains under pressure from the weakness of veg oils, especially in Malaysia. At the same time, rains in South America are suggesting a possible record harvest in these countries,” analysts Agritel said in a market note.
Malaysian palm oil futures plummeted in Thursday’s trade as stronger production fuelled concern about growing stockpiles amid soft demand, while weakness in rival oils compounded the bleak picture.
Brazil and Argentina are on track for another year of bumper soybean production as rains ease concerns over dry weather brought by the La Nina weather phenomenon.
Rains that fell on Argentina’s main farm belt over the weekend brought relief to parched soy and corn-growing land, meteorologists said on Monday, allowing the planting of crops to resume in most of the affected areas.
Chicago wheat edged up on Thursday to its highest point in two weeks as concerns about below normal temperatures across the U.S. grain belt underpinned the market.
The CBOT’s most-active wheat contract was up 0.2 percent at $4.24-1/2 a bushel, after climbing to its highest since Dec. 7 at $4.25 a bushel.
“Certainly, at these prices there is some support and we are seeing unfavourable weather in the United States,” said Phin Ziebell, agribusiness economist at National Australia Bank.
“But it is a tough bet to see a sustained pick-up in prices as there are ample supplies.”
Temperatures in hard wheat-growing areas in the United States are expected to be below normal next week.
Sub-zero lows measured in Fahrenheit are not forecast to be as widespread as thought earlier this week, forecasters said, but temperatures in some areas may still be frigid enough to damage crops.
European wheat futures were little changed with March milling wheat futures on Paris-based Euronext down 0.2 percent at 160.50 euros a tonne, while other positions were unchanged to slightly higher.
Dealers said a firm euro has helping to cap EU prices. The currency has risen about one percent so far this week against the dollar, supported by a rise in German bond yields.
Corn gained 0.1 percent to $3.49-1/2 a bushel.
