Chicago | Reuters—Chicago corn and soybean futures fell on Tuesday following U.S. President-elect Donald Trump’s threat of tariffs against major trading partners, while forecasts for strong South American crops also pressured prices, traders said.
Wheat futures rose on a technical bounce as market players shrugged off last week’s news of an escalating conflict in the Black Sea.
Trump, who takes office on Jan. 20, said on Monday that he would impose a 25 per cent tariff on imports from Canada and Mexico until those countries clamped down on drugs and migrants crossing the border, while also outlining an additional 10 per cent tariff on imports from China.
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Market reaction was relatively muted.
“Beans and corn aren’t falling apart,” said Ted Seifried, vice president of Zaner Group. “The concept of tariffs has been widely accepted for the last two weeks, and we’re waiting to see how that plays out.”
Chicago Board of Trade soybeans Sv1settled down 2-1/4 cents to $9.83-1/2 a bushel, with declines tempered by a rise in soyoil futures.
Chicago soyoil futures climbed as tariffs raised the prospect of more domestic soyoil being used in biofuel, traders said.
CBOT corn Cv1 settled down 5 cents at $4.28 per bushel while CBOT wheat Wv1settled up 2-1/4 cents at $5.58 a bushel.
Wheat came under pressure earlier from news that U.S. winter wheat crop conditions improved for a fourth straight week following timely rainfall across the Plains this month, according to a U.S. Department of Agriculture report late on Monday.
But the easing in the dollar, a technical bounce and a handful of tenders by importers and sales of U.S. wheat early Tuesday lent some support.
Some participants were covering short positions in the run-up to Thursday’s U.S. Thanksgiving holiday, adding a floor to prices, traders added.
—Additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore
