Chicago | Reuters — U.S. soybean futures fell 1.9 per cent to a one-week low Friday morning on reports of big harvest yields and heavy farmer sales on the cash market, traders said.
Wheat futures weakened as traders said ample global supplies were likely to blunt the impact of India’s decision to slash its import tax on the grain. Corn, also facing pressure from the ongoing harvest, was down slightly.
Soybeans have fallen 0.8 per cent so far this week, on track for their third drop in the last four weeks. The declines have stemmed from weakness in the cash markets as the pace of harvest picks up around the Midwest.
“We are starting to see the basis drop across the country precipitously,” said Chris Robinson, senior trader and analyst at Top Third Ag Marketing. “Next week it is forecasted to go lower. The supplies are readily available.”
At 10:08 a.m. CT, Chicago Board of Trade November soybean futures were down 18-1/4 cents at $9.58-1/4 a bushel (all figures US$).
CBOT December soft red winter wheat futures were 1/2 cent lower at $4.05 a bushel. The contract has risen 0.4 percent this week.
The Indian government on Friday lowered the wheat import tax to 10 per cent from 25 per cent as part of its efforts to curb food inflation. Wheat output in India, the world’s second-biggest producer, has fallen well below the peak of 2014-15, reducing stocks to the lowest level in nearly a decade and pushing domestic prices close to record highs.
But a strong U.S. dollar and ample global supplies were likely to limit the pick-up in demand for U.S. wheat on the export market, keeping the gains in wheat in check, traders said.
CBOT December corn futures on Friday morning were down 3/4 cent at $3.36 a bushel, on track for a weekly loss of 0.3 per cent.
Losses in corn were kept in check by end-of-week short-covering as well as some technical support. Buyers stepped into the market when the December contract hit its 40-day moving average.
Corn markets also faced price pressure from Friday’s announcement by China that it was provisionally putting anti-dumping duties on U.S. distillers’ dried grains (DDGs), a byproduct of corn ethanol used by feed mills as a substitute for corn and soymeal.
— Mark Weinraub is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Gus Trompiz in Paris.