WINNIPEG, Sept. 20 (CNS) – The ongoing U.S. harvest is keeping a lid on rallies in corn and soybean markets.
Corn futures on the Chicago Board of Trade chopped above and below the psychologically-important US$3.50 per bushel mark during the week ended Sept. 20.
Soybeans felt some pressure from fund selling and generally seemed to be stuck in a range between US$9.62 to $9.75.
One bright spot for the soybean market though was the unexpected sale of 1.08 million tonnes of soybeans to unknown destinations on Sept. 20.
“It helps when we have demand news like that,” said Jack Scoville of Price Futures Group in Chicago.
He says many participants are waiting for yield reports to come in as no one seems to have a clear handle on the size of either crop.
“That will dictate market action along with demand news and weather,” he said, adding the corn crop seemed to be drying while soybeans were turning colour.
Scoville puts support for corn (December contract) around the $3.40 a bushel mark.
“Without confirmation of a super-huge crop we could see some limited downside down to that level perhaps but really not much more,” said Scoville.
Last week China auctioned off more of its state corn crop, selling more than 700,000 tonnes in one day alone. Scoville says the auctions aren’t helping prices, but he’s not sure they’re really hurting them either.
“We know China isn’t a big buyer in the corn market,” he explained. “They also made it pretty clear they were getting ready to sell a bunch of corn.”
When it comes to soybeans, Scoville pegs the next support level down at $9.60 a bushel. But he says there is room to the upside.
“We could have a shot at $10, depending on how these yields turn out,” he said.
On the international front, dry conditions in Brazil have delayed planting of soybeans in some regions, which was supportive for U.S. prices.