SINGAPORE, Dec 18 U.S. soybeans edged lower on Friday, giving up some of last session’s gains on expectations that farmers in Argentina will pump large supplies into the market after the country’s peso currency plunged.
Wheat and corn lost ground with ample global supplies adding pressure on prices.
“Argentina’s currency had a free fall against the U.S. dollar, buyers are waiting for large Argentinean exports early next year,” said Kaname Gokon at brokerage Okato Shoji in Tokyo.
“Going forward framers in Argentina are going to be planting more grains and oilseeds.”
Chicago Board of Trade January soybeans fell 0.3 percent to $8.74-1/4 a bushel by 0258 GMT and March wheat gave up 0.4 percent to $4.82-1/4 a bushel. Corn lost 0.1 percent to $3.73-3/4 a bushel.
For the week, soybeans are on track for a marginal gain after declining almost 4 percent last week, while corn is down for a second week in a row. Wheat has dropped 1.6 percent this week after rising for the last two weeks.
The currency devaluation in Argentina is expected to push millions of tonnes of pent up grains supply into the international market at a time when the world is already seeing record stockpiles.
For the first time since 2011 Argentineans have full access to U.S. dollars after the new government allowed the exchange rate to float. The policy shift prompted a more than 26.5 percent devaluation of the peso that will make exporting more profitable for farmers, who get paid in the newly muscular dollar.
Soybean prices rose 1.7 percent on Thursday on concerns that dry weather in Brazil may clip soy production. The crop in northern Brazil is entering a key development stage when dry conditions could negatively impact yields.
A weather model suggested drier conditions in the six- to 10-day period for Brazil’s Mato Grosso state.
Commodity funds bought an estimated net 12,000 Chicago Board of Trade soybean contracts on Thursday, trade sources said. The funds were also net buyers of 8,500 corn contracts and were net even in wheat, they said.
Private analytics firm Informa Economics lowered its forecast for 2016 U.S. corn plantings to 88.926 million acres, from 90.1 million last month.
The firm cut its forecast for U.S. 2016 soybean plantings to 84.537 million acres, from 85.3 million previously.
Prices at 0258 GMT
Prices at 0258 GMT Contract Last Change Pct chg Two-day chg MA 30 RSI CBOT wheat 482.25 -1.75 -0.36% -0.26% 489.08 52 CBOT corn 373.75 -0.50 -0.13% +1.08% 373.09 51 CBOT soy 874.25 -2.75 -0.31% +1.36% 871.63 47 CBOT rice $11.12 $0.01 +0.05% +1.46% $11.61 46 WTI crude $34.85 -$0.10 -0.29% -1.89% $39.98 26 Currencies Euro/dlr $1.084 $0.002 +0.17% -0.62% USD/AUD 0.713 0.000 +0.04% -1.42%
(Source – http://in.reuters.com/article/global-grains-idINL3N1471ET20151218)