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PM markets: soybean futures rise on wet weather

08 сентября 2016 года

Soybeans edged up, helped by rain worries in the US Midwest, while wheat futures turned lower as energy markets fell back.

Rains will in the US Midwest is threatening to row crop harvest there.

Kyle Tapley, at MDA Weather Services, saw the rains "slowing corn and soybean maturation and drydown, and increasing disease threats".

Richard Feltes, at RJ O'Brien, noted early strength in soybeans helped by the delayed start to the soybean harvest.

US export sales for the autumn have been heavy, and although the crop is expected to be huge, it is likely to arrive slower than normal this year.

Energy support falls away

Energy markets pulled their support through the session, as crude oil prices turned lower.

Oil prices spiked to one-week highs on Monday, based on ideas that Opec and Russia might come to agreement on restricting supply.

But such hopes have been in play before every Opec meeting since 2014, and scepticism pulled markets lower on Tuesday.

Long weekend catch up

The US market, which was closed on Monday for a national holiday, still had some news from the weekend to absorb.

After Friday's close the broker INTL FCStone raised its forecast of US corn yield to a record 175.6 bushels per acre, up from 175.0 last month.

Still there is at least some support from ideas that farmers will not sell at the current low prices, as Mr Feltes reported that in the US farmers are "committed to holding as much new crop corn off the market as possible".

Brazilian corn crop ideas cut

Conab the Brazilian crop supply agency, trimmed its idea of the corn crop just finished to 66.98m tonnes, down from 68.48m tonnes forecast in August, in its final forecast of the crop year.

US corn export inspections for the most recent week were reported at 1.47m tonnes, up from 1.42m tonnes last week.

December corn futures finished the day unchanged, at $3.28 Ѕ a bushel.

Hedge funds sell soybean longs

FCStone raised its forecast for US soybean yields to a record 50.1 bushel per acre, up from last month's forecast of 48.8.

More significantly, there was the latest data on hedge funds positions, released on Friday afternoon by the Commodity Futures Trading Commission, to absorb.

Hedge funds cut their net long position in Chicago soybean futures below 100,000 lots, meaning that they are the least bullish on the oilseed for four months, leaving room for more buying.

But Tobin Gorey, at CBA, noted that "the funds are still very long," meaning that there is still downside risk to prices.

Conab slightly raised its estimate of the Brazilian soybean crop that finished this year to 95.43m tonnes, down a touch from the 95.42m tonnes forecast last month.

The latest weekly US soybean export inspections were reported at 1.23m tonnes, up from 921,528 in the week previous.

November soybean futures ended up 0.6%, at $9.59 ѕ a bushel.

Russian pressure

Broker Benson Quinn Commodities said at the time that the CFTC upgrade short positions in Chicago wheat had "a supportive tilt to it".

But funds are short for a reason, namely because the global balance sheet is very heavy, a fact underlined as the Moscow based consultancy Ikar lifted its forecast the Russian wheat crop by 2m tonnes, to 72m tonnes.

US weekly wheat export inspections were reported at 639,315 tonnes, up from 577,300 last week.

December wheat futures finished down by 0.3%, at $3.98 Ѕ a bushel.

Coffee 'grinds higher'

Arabica and sugar prices rose, helped by a stronger Brazilian real, which lowers local currency denominated prices in the world's top grower, discouraging seller.

"You can't fight the trend right now," a US trader told Agrimoney.

The trader suggested that despite the lack of any tightness in the market "more of this buying is on future production".

He said that the shifting speculative sentiment was prompting an "orderly grind higher in the coffee market".

Arabica coffee futures finished up 1.6%, at $153.75 cents a pound.

Sugar edged up on rain worries

The raw sugar market continues to pay close attention to the progress of the cane crop in Brazil, with every delay to production supporting prices.

"There has been some rain lately in CS Brazil growing areas which has caused an estimated loss of four days (crushing) in the second half of August and nearly three days so far in the first half of September," said Nick Penney at Sucden Financial.

October raw sugar settled up 0.2%, at 20.22 cents a pound.

Source: Agrimoney.com  |  #grain   |  Comments: 0   Views: 54

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