April 17, 2020

 

US soybean futures regain from 3-1/2-week low

 

 

Chicago Board Of Trade (CBOT) soybean futures bounced back on Wednesday from their lowest after more than three weeks.

 

Prices remained under pressure on prospects of demand destruction caused by the COVID-19 pandemic.

 

Wheat prices were little changed after two sessions of losses, while corn ticked higher.

 

The most-active soybean contract on CBOT was up 0.4% at US$8.50-1/4 a bushel, as of 0403 GMT, having dropped to its lowest since March 20 in the previous session.

 

Wheat was trading at US$5.49-3/4 a bushel, having closed down 1% on Tuesday, while corn was up 0.2% at US$3.32-3/4 a bushel after dropping 1.7% in the previous session.

 

"It will be a big issue for soymeal demand as US meat processing plants close down," said one Singapore-based trader at an international trading company. "Soymeal prices are still pretty high, given the fears of lower demand."

 

Chicago soymeal futures rose on Wednesday but the market is poised for a fourth week of losses.

 

Several US meat processing plants temporarily closed last week after workers contracted the novel coronavirus, prompting fears of a knock-on effect on demand for soymeal widely used in feeding livestock.

 

The USDA estimated 62% of US winter wheat was in good or excellent condition, stable on the week and slightly above last year.

 

Egypt, the world's largest wheat buyer, bought 120,000 tonnes of Russian wheat in a tender, lower than anticipated.

 

Corn is under pressure as depressed oil prices weigh on demand for ethanol. More than a third of the US crop goes to ethanol biofuel.

 

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