(Agriculture.com) – Chicago wheat futures slid more than 1.5 percent on Monday, falling for a second session as an improving weather outlook for the U.S. winter crop weighed on prices.
U.S. soybeans were also down, under pressure from a lack of demand from top importer China amid a trade dispute between Washington and Beijing.
The Chicago Board of Trade most-active wheat contract had dropped 1.6 percent to $5.17-3/4 a bushel by 1100 GMT, adding to Friday’s 2.2 percent decline.
Soybeans lost 0.7 percent to $10.29-1/4 a bushel, while corn slid 0.6 percent to $4.04 a bushel.
“It is a weather-driven market, prices are coming under pressure as there have been rains in some parts of the U.S. Plains and there are forecasts of more rains, but it is not a complete reversal of trend,” said an India-based commodities analyst.
The contract hit a more than nine-month high last week on worries about dryness hurting the hard red winter wheat crops in top producer Kansas but recent rains have eased some concerns. “Recent highs that had not been seen since last summer have pushed some operators to anticipate some sales. Improvements in climatic conditions with possible rains have also reinsured the traders,” French consultancy Agritel said.
Scouts on an industry tour on Thursday projected that drought-hit Kansas, the top U.S. wheat-growing state, may produce its smallest crop since 1989.
Forecasts of bumper production in the Black Sea region are also putting pressure on wheat prices.
For soybeans, there is disappointment that trade talks between Washington and Beijing did not move closer to a deal to resolving the mounting dispute that has crimped U.S. crop sales to China.
The U.S. administration has drawn a hard line in trade talks with China, demanding a $200 billion cut in the Chinese trade surplus with the United States, sharply lower tariffs and advanced technology subsidies.
U.S. farmers were hoping for a quick resolution to the conflict after China last month threatened tariffs against a range of U.S. goods, including a 25-percent duty on soybeans. U.S. soybean sales to China over the last four weeks are down 10 percent from a year ago, according to U.S. trade figures. This is a blow to farm country, which helped push President Donald Trump into office in the 2016 election.
