Chicago | Reuters — U.S. soybean futures drifted lower for the third time in four sessions on Thursday as demand from China remained quiet, stirring fresh concerns that purchases from the world’s top oilseed buyer will fall due to the spread of the coronavirus.
Corn futures also weakened, pressured by a bearish U.S. acreage forecast, and wheat futures fell on technical selling, traders said.
Soybean futures also faced pressure from expectations of a massive harvest in Brazil that will boost competition on the export market.
“The bean crop more than likely is going to get bigger in South America,” said Mark Schultz, chief analyst at Minnesota-based Northstar Commodity Investment Co.
Chicago Board of Trade March soybean futures dropped 4-1/2 cents to close at $8.92-3/4 a bushel (all figures US$).
China is struggling to get its economy back on track after imposing severe travel restrictions to contain the coronavirus that emerged in the central province of Hubei late last year and has claimed more than 2,100 lives, with over 74,000 people infected.
“Several parts of China are in lockdown for more than 20 days now, the demand for soybeans and other products is bound to decline,” said one Singapore-based trader at a company that has soybean processing facilities in China.
Prospects of China ramping up agricultural purchases from the United States under the interim trade deal have been clouded by the COVID-19 epidemic.
“The soybeans are not going to be able to rally unless the Chinese come in and start buying some old crop in size,” ED+F Man Capital said in a note to clients.
Some U.S. dealers remained hopeful that demand could emerge soon with market talk of Chinese interest in sorghum and soybeans this week.
“While most would like to believe the rumours are true, they’d like to see it confirmed,” brokerage Allendale said in a market note.
CBOT March corn ended down two cents at $3.78-1/2 a bushel.
The U.S. Agriculture Department on Thursday morning forecast 2020 U.S. corn plantings at 94 million acres, up from 89.7 million in 2019. Analysts had forecast USDA would peg 2020 corn plantings at 93.6 million acres.
CBOT March soft red winter wheat was down 5-1/4 cents at $5.60 a bushel.
Wheat futures firmed during the overnight session before turning lower after nearing the three-week high hit on Tuesday.
— Reporting for Reuters by Mark Weinraub in Chicago; additional reporting by Nigel Hunt in London and Naveen Thukral in Singapore.