Chicago | Reuters—Chicago Board of Trade soybean and corn futures drifted lower on Wednesday as initial optimism faded over the U.S. and China agreeing on the framework of a trade truce, and market players shifted their focus back to benign crop weather, analysts said.
CBOT July soybeans SN25 settled down 7-1/4 cents at $10.50-1/2 per bushel. July corn CN25 ended down 1-3/4 cents at $4.37 a bushel and July wheat WN25 finished down 1/4 cent at $5.34-1/4 a bushel.
Soybeans had earlier firmed as brokers cautiously welcomed news that Sino-U.S. trade talks had concluded in London, and President Donald Trump said a trade deal was “done.” However, futures turned lower on a lack of specifics about agricultural goods.
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China is the world’s biggest soybean importer, while the U.S. is the No. 2 exporter of the oilseed. Chinese retaliatory tariffs on U.S. agricultural goods have curbed soybean trade, with Brazil dominating China’s record soy imports in May.
“There was optimism off the bat on the U.S.-China trade talks. Then as we went forward, we were talking a lot about rare earths … and not much talk about agriculture that I saw. I guess the devil is in the details,” said Don Roose, president of Iowa-based U.S. Commodities.
Meanwhile, weather forecasts for the Midwest were generally favorable for developing crops, signalling strong yield potential. U.S. farmers have finished planting corn and are nearly done with soybeans.
“Weather maps continue to come out, for the most part, as non-threatening,” Roose said.
Market players await monthly supply/demand reports due on Thursday from the U.S. Department of Agriculture that will include updated estimates of U.S. wheat production. Analysts also expect the USDA to trim its forecasts of domestic corn stockpiles, given a brisk pace of corn export sales.
Wheat futures closed narrowly mixed, awaiting fresh direction as the winter wheat harvest begins in much of the Northern Hemisphere. The USDA on Monday raised its ratings for both spring and winter wheat crops.
Traders continue to monitor developments in the Black Sea grain export region, where Russia has stepped up bombardments of Ukraine that Moscow says are retaliatory measures for Kyiv’s recent attacks. Russia is the world’s biggest wheat exporter and Ukraine is the sixth-largest supplier.
—Additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore
