GRAINS-Soybeans Drop to 3-Week Low on Argentina Rain Forecast, Corn Falls
(Reuters) – Chicago soybeans slid for a fourth straight session on Thursday, hitting a three-week low, as forecasts of rains in Argentina’s crop-belt eased the prospects of production losses.
Corn slid, snapping four sessions of gains, while wheat lost ground as a stronger U.S. dollar weighed on agricultural markets.
The Chicago Board Of Trade most-active soybean contract was down 0.1 percent to $10.23 a bushel by 0341 GMT, after falling to a low of $10.18-1/2 a bushel, the weakest since Nov.23.
Corn fell 0.2 percent to $3.61-1/4 a bushel and wheat slipped 0.1 percent to $4.17-1/2 a bushel.
“There is outlook for rains in Argentina in the near term which is driving the soybean market,” said Rajesh Singla, head of agriculture research at Societe Generale.
“Brazil is expected to produce a record crop and we might even increase our estimates for Brazil’s soybean production as the weather has been really beneficial for the crop.”
Soybean prices came under pressure from more favourable weather for production in Argentina, the world’s third-largest soybean exporter.
The Argentine rain outlook boosted crop prospects from the key exporter, denting prospects for U.S. exporters, already under pressure from high Brazilian supplies.
Brazil’s Abiove, the country’s soybean industry group, on Wednesday forecast that the country will produce 101.7 million tonnes of soybeans in the 2016/17 crop year, with 58 million tonnes of the crop expected to be exported.
There was additional pressure stemming from a stronger dollar which makes commodities priced in the greenback expensive for foreign buyers holding other currencies.
The dollar rose to a 14-year peak against a basket of major currencies after the Federal Reserve boosted the number of projected interest rate hikes for 2017, rejuvenating the bmonth-long Trump rally and knocking emerging market currencies.
Commodity funds were net buyers of CBOT wheat, corn and soyoil futures contracts on Wednesday, traders said. The funds were net sellers of soybeans and soymeal.
