Chicago | Reuters — U.S. soybean futures fell to a one-month low Monday as soymeal tumbled for a fourth straight session, pressured by long liquidation and easing concerns about a crop shortfall in Argentina, analysts said.
Wheat declined in largely technical moves, with traders taking profits after last week’s multimonth highs. Corn followed the weak tone as U.S. planting weather improved.
Chicago Board of Trade July soybean futures settled down 25-1/4 cents at $10.11-1/2 per bushel after dipping to $10.10-3/4, the contract’s lowest since April 4 (all figures US$). July soymeal ended down $11.20 at $382.50 per short ton, retreating farther from its May 2 contract high of $406.50.
CBOT July wheat closed down 14-3/4 cents at $5.11-1/2 a bushel and July corn lost 5-1/2 cents at $4.00-3/4 a bushel.
Soymeal set the tone for soybeans. The U.S. Commodity Futures Trading Commission’s weekly commitments report showed managed funds expanded their net long position in CBOT soymeal futures in the week to May 1 to 132,126 contracts, the largest in records dating to 2006, leaving the market vulnerable to longs liquidation.
“We had too much length in meal,” said Roy Huckabay, analyst of Linn + Associates, a Chicago brokerage.
Meanwhile, cash soy values have softened in Brazil, an indication that the market has factored in crop losses in drought-hit Argentina, the world’s biggest exporter of soymeal.
“I think we’ve got the meal out there,” said Ted Seifried, analyst with Zaner Ag Hedge. “Brazil is getting aggressive. Their (soy export) premiums have simmered down quite a bit, and that is allowing our (U.S.) prices to come off,” he said.
Brazilian consultancy AgRural raised its estimate of Brazil’s 2017-18 soybean harvest to a record high 119.2 million tonnes, up from 119 million in April.
Worries also persist about export demand for U.S. soy after trade talks between U.S. and China officials ended last week without major agreements. China’s top economic envoy will visit Washington next week to resume trade talks with the Trump administration, the White House said.
CBOT July wheat fell nearly three per cent, retreating on profit-taking after worries about drought in the U.S. Plains and elsewhere lifted the contract to a nine-month top last week.
After the CBOT close, the U.S. Department of Agriculture (USDA) in its weekly crop progress report rated 34 per cent of the U.S. winter wheat crop in good to excellent condition, up from 33 per cent a week earlier.
USDA said the U.S. corn crop was 39 per cent planted, up from 17 per cent the previous week and above an average of analysts’ expectations for 37 per cent.
— Julie Ingwersen is a Reuters commodities correspondent in Chicago.