WINNIPEG — Great spring seeding conditions across much of the U.S. Midwest have weighed on soybean and corn futures at the Chicago Board of Trade, and the nearby bias remains pointed lower, barring a weather scare, according to an analyst.
“The good growing conditions will keep (soybeans and corn) grinding lower,” said Terry Reill, of Futures International in Chicago.
While there is always the risk of a weather scare to trigger a short-covering bounce, Reilly said slowing demand for both corn and beans would also keep soybeans and corn under pressure.
He said export demand was tapering off for soymeal, while a large U.S. winter wheat crop will soon be under-cutting corn demand in the domestic feed market.
Reilly said July corn was facing a downside target at US$3.50 per bushel, while soybeans could eventually test the US$9 per bushel mark.
Yield and quality concerns with the U.S. winter wheat crop do have the potential to provide some spillover support for soybeans and corn, but Reilly said any support would be relative because the general path of least resistance was also lower in wheat.
