GRAINS-Soybeans ease after rally to 4-wk top, corn up for 5th day

August 18th, 2016

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Category: Oilseeds

Soybean Harvest 450x299(Reuters) – Chicago soybean prices slid on Thursday as the market took a breather after climbing to a four-week high earlier in the session on the back of strong purchases by top importer China.

Corn rose for a fifth consecutive session on expectations of strong demand from animal feed makers and short-covering, while wheat dipped after closing marginally higher on Wednesday.

The Chicago Board of Trade most-active soybean contract had fallen 0.2 percent to $10.13-3/4 a bushel by 0259 GMT.

Earlier in the session, the contract hit $10.17-1/2 a bushel, matching Wednesday’s highest price, which was the strongest since July 21.

Corn gained 0.5 percent to $3.41-1/2 a bushel and wheat lost 0.1 percent to $4.25-3/4 a bushel.

The soybean market is being torn between bearish influence stemming from expectations of record U.S. production and support from strong purchases by China. “Some of the yield reports coming out of the U.S. are just enormous, they are expecting records by 10 to 20 percent in some of the areas,” said one Melbourne-based commodities analyst.

“There is upside to yield prospects with recent rains in areas that were dry.” At the same time there is strong demand from China, which buys more than 60 percent of soybeans traded around the world.

The U.S. Department of Agriculture said on Wednesday that private exporters reported the sale of 381,000 tonnes of soybeans to China for delivery during the 2016/17 marketing year.

The agency also said that exporters reported the sale of 129,000 tonnes of soybeans to unknown destinations, correcting an Aug. 4 announcement that said corn was the commodity sold in the deal.

All-time high or near-record wheat output in key exporting regions, including the Black Sea area, is pressuring wheat futures.

Ukraine’s 2016 grain harvest is likely to be around 63 million tonnes – 3 million more than last year, agriculture ministry official Leonid Sukhomlin said at a briefing on Wednesday. He said better than expected weather this spring and summer had increased the yield of wheat and other grains.

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