Soy slips back, wheat stays weak in broad commodity fall
Chicago soymeal futures edged lower on Monday as a retreat across commodities encouraged the oilseed…Chicago soymeal futures edged lower on Monday as a retreat across commodities encouraged the oilseed market to consolidate after an 18-month high before the weekend due to concerns about rain losses in Argentina’s soybean harvest.
Soybean futures also eased as investors focused on a steady dollar and the possibility of a U.S. interest rate rise, as well as oversupply in crude oil.
Corn and wheat tracked the down move. Wheat was on course for a fourth consecutive daily loss as the cereal continued to be weighed down by large global stocks and favorable prospects for northern hemisphere harvests. “It’s a slight round of profit-taking.
It’s not only ags, there’s crude oil and a lot of other commodities going south,” Stefan Vogel, head of agricultural commodity markets research at Rabobank, said.
Chicago Board of Trade most-active soybeans fell 1.0 percent to $10.63-3/4 a bushel. Soymeal dropped 0.6 percent to $390.3 a short ton, pulling back from Friday’s high of $392.7.
Soymeal, the livestock feed which is produced along with soyoil when soybeans are crushed, has added 44 percent since the start of April as heavy rains have threatened the size and quality of the crop in Argentina, which accounts for almost half of global meal exports.
The dollar got off to a steady start against a basket of major currencies on Monday, remaining within striking distance of a two-month peak after markets last week moved to price in a greater chance of an imminent hike in U.S. interest rates.
A stronger dollar tends to weigh on commodity prices by making them more expensive for buyers holding other currencies.
Soy prices could be choppy in the coming weeks until the market gets greater clarity on U.S. planting from the U.S. Department of Agriculture’s June 30 acreage report, Vogel said.
Investors are watching to see if U.S. farmers plant more soybeans than initially planned due to recent price gains, which could offset weather-related supply losses in South America.
CBOT wheat lost 1.1 percent to $4.62-3/4 a bushel. Corn dropped 0.8 percent to $3.91-1/2 a bushel.
Broadly favorable growing conditions in the United States, Europe and the Black Sea region have kept attention on ample supply of wheat.
“We’re coming up to the U.S. harvest and if yields are as expected I don’t see anything to drive the wheat market higher,” Vogel said.
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