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Soybeans, corn hit 1-week low as US harvest advances

Crop By Reuters | 24th Sep, 2020

Chicago soybeans fell 1.2% on Thursday while corn lost more ground, with both commodities hitting a one-week low as an advancing U.S. harvest boosted supplies, although losses were checked by strong demand from China.

Corn extended declines to a fourth straight session while wheat slid for a second day, dropping 1.1% as a stronger dollar made U.S. supplies more expensive for buyers holding other currencies.

 “A stronger U.S. dollar is not helping but we also suspect the market is fatigued after such a strong rally from mid-August,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia, referring to soybean prices climbing to their highest since June 2018 last week.

Meanwhile, favourable weather helped the U.S. harvest for corn and soybeans gather pace. The United States Department of Agriculture (USDA) on Monday said U.S. farmers had completed 6% of the soybean harvest and that the corn harvest was 8% complete.

The most-active soybean contract on the Chicago Board Of Trade (CBOT) slid 1.2% to $10.02-3/4 a bushel by 0305 GMT, the lowest since Sept. 16, while corn fell 0.9% to $3.65-1/4 a bushel and wheat was down 1.1% at $5.42-3/4 a bushel.

However, strong demand from China helped limit declines.

The USDA on Wednesday confirmed private sales of another 132,000 tonnes of soybeans to China as well as 126,000 tonnes of soybeans to unknown destinations. It was the fourteenth trading day in a row that the government has announced a soybean sale to China.

Argentina’s upcoming soybean and corn crops will be smaller than last season’s due to dry weather and capital controls that are hurting farmers’ profits, the Buenos Aires Grains Exchange said in a teleconference with agricultural analysts on Wednesday.

Commodity funds were net sellers of CBOT wheat, soyoil, soybean and corn futures contracts on Wednesday, traders said. The funds were net buyers of soymeal futures. 

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