Glacier FarmMedia | MarketsFarm — Soybean and corn futures at the Chicago Board of Trade were pressured by losses in crude oil over the past week, but uncovered support and could see some choppiness ahead of the United States election.
“There’s a tug-o-war going on right now,” said Sean Lusk of Walsh Trading in Chicago, adding “you have a massive amount of grain coming to market versus good demand — which are offsetting each other.”
He expected demand would win out in the longer term, taking prices higher, “but that may take awhile” and the markets may trade sideways after getting past the Nov. 5 election.
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U.S. ending stocks of both corn and soybeans were large in 2023/24, with reports for the 2024/25 harvest pointing to record yields. While those ample supplies are bearish, Lusk noted that from a chart-standpoint speculators have already pared their net short position significantly which was supportive.
Looking farther out, uncertainty over South American production has provided some support recently, but Lusk noted that moisture conditions were improving in Brazil, and he expected Chinese buying interest would eventually shift away from the U.S.
Another possible supportive factor for soybeans is the recent strength in soybean oil, which was underpinned by gains in palm oil. Lusk said that while soybeans usually took more direction from the meal side of the soy complex, the tight supplies and strong global demand causing palm oil to rally would support soybeans on any breaks lower.
