Posted on November, 6, 2023 at 09:39 am
Chicago soybean futures climbed to a seven-week high on Monday with erratic weather in the world’s No. 1 exporter Brazil and demand for US cargoes underpinning the market.
There was additional support for soybeans from a weaker dollar which also lifted corn prices.
“There have been some issues with the Brazilian weather for soybean planting which is supporting prices,” said one Singapore-based trader.
“And China’s demand for the next two months is likely to be strong.”
The most-active soybean contract on the Chicago Board of Trade (CBOT) climbed 0.5% to $13.59 a bushel, as of 0414 GMT, after reaching its highest since Sept. 15 at $13.59-1/4 a bushel earlier in the session. Corn added 0.2% to $4.78 a bushel while wheat lost 0.6% to $5.69 a bushel.
The market is monitoring uneven crop weather in Brazil, where soybean planting is under way.
Dry conditions have been a concern in portions of leading soy-producing state Mato Grosso, while excessive rains have drenched southern areas.
Still, brokerage StoneX raised its forecast of Brazil’s 2023/24 soy crop this week to 165 million metric tons, from the previous forecast of 164.1 million tons.
China’s 2023 soybean imports seen at record 105mn metric tons on strong Q4 arrivals
China’s soybean imports are likely to stay high through the fourth quarter, taking 2023 purchases to an all-time record, but lacklustre demand from loss-making hog farms is seen reducing purchases in early 2024, traders and analysts said.
Soybeans got a lift on Friday after the US Department of Agriculture (USDA) confirmed private sales of 131,150 tons of US soybeans to unknown destinations.
A weaker dollar, which is making US grains and soybeans more attractive on the world market is underpinning the greenback-priced commodities.
Major global currencies were steady early on Monday with investors preparing for the US dollar to extend declines from late last week after the Federal Reserve dialled down its hawkish rhetoric.
The dollar index declined more than 1% last week, its heaviest fall since mid-July and hit a six-week low.
Analysts are awaiting the USDA’s Nov. 9 monthly supply/demand reports in which the government will release updated US and global crop estimates.
In news, Ukraine has harvested more than 67 million metric tons of grain and oilseeds from the new 2023 harvest so far, the agriculture ministry said on Friday.
The ministry gave no comparative data. It said 47.2 million tons of grain and about 20 million tons of oilseeds had been threshed.
The harvest ends late this year, depending on the weather. Large speculators increased their net short position in Chicago Board of Trade corn futures in the week to Oct. 31, regulatory data released on Friday showed.
The Commodity Futures Trading Commission’s weekly commitments of traders report also showed that noncommercial traders, a category that includes hedge funds, increased their net short position in CBOT wheat and switched to a net long position in soybeans.
Source: Business Recorder