Chicago | Reuters—Chicago Board of Trade grain and soybean futures slid on Monday on forecasts for favorable U.S. crop weather, traders said.
Grain markets also weakened after U.S. President Donald Trump did not announce a trade agreement with China, traders said, as some had expected before markets closed for the Independence Day holiday on Friday.
Futures jumped last week as traders adjusted positions in case U.S. weather conditions turned hotter or drier over the long weekend, or Trump made an announcement on trade at a speech in Iowa.
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U.S. grains: Corn futures edge up, soybeans sag on improving US crop ratings
Chicago Board of Trade corn futures extended slight gains on Tuesday as short covering and bargain buying continued to support a rebound from contract lows reached during the previous session.
Instead, rain benefited the U.S. Plains and western Midwest, and boosted soil moisture in Iowa, according to weather firm Vaisala. Temperatures will be near normal in most areas this week, the firm said, favoring corn crops during the critical pollination period of development.
The U.S. Department of Agriculture said after trading ended that 74 per cent of the nation’s corn crop was in good or excellent condition, up one percentage point from a week earlier.
“You continue to have a non-threatening weather outlook,” said Matt Wiegand, commodity broker for FuturesOne.
Most-active CBOT corn futures Cv1 fell 16-1/4 cents to $4.20-3/4 a bushel, while soybean futures Sv1 ended down 28-1/2 cents at $10.20-3/4 a bushel. Wheat futures Wv1 declined 8-1/4 cents at $5.48-1/2 a bushel.
Traders were concerned about the uncertain outcome of trade talks between the United States and key trading partners, particularly Beijing.
Last week, CBOT soybean futures rallied ahead of Trump’s speech in Iowa on Thursday on hopes for improved relations with China, the world’s biggest importer of the oilseed.
“The end of last week, the trade heard rumors that China was stepping back into U.S. ag markets,” brokerage CHS Hedging said in a note on Monday. “Headlines of that are cold this morning.”
The USDA said exporters sold 135,000 metric tons of U.S. corn to Mexico.
In Russia, the world’s largest wheat exporter, wheat exports are expected to get a boost following a fall in an export tax to zero.
— Additional reporting by Michael Hogan in Hamburg and Naveen Thukral in Singapore
