Soy steady near three-week top as exports offset output forecast
PARIS/SINGAPORE - Chicago soybean futures were slightly higher during European trading on Tuesday, holding near an earlier three-week high as brisk export demand offset favorable growing conditions that have led the U.S. government to forecast a record harvest.
Corn inched up as the feed grain continued to recover from a seven-year low hit on Friday after the government also projected a record U.S. corn crop. Wheat ticked lower, however, curbed by large global supplies.
The Chicago Board of Trade most-active soybean contract was up 0.1 percent at $10.10-1/2 a bushel by 1052 GMT after rising to its highest since July 22 at $10.15 earlier in the session.
The oilseed market shook off the U.S. Department of Agriculture's (USDA) forecast on Friday for a record U.S. harvest this year, setting production against an improved export outlook marked by a run of sales to China.
"The soybean market managed to consolidate over $9.80 on the November 2016 contract in Chicago, offering a support element to the bullish move," consultancy Agritel said in market note. "Export figures with a progression of business to China and data on crushing from NOPA are further support factors."
A monthly National Oilseed Processors Association (NOPA) report released on Monday triggered a rally in soyoil by showing lower than expected supplies of the edible oil, providing additional support to beans.
CBOT soybeans edged down during Asian trading hours on Tuesday as a weekly USDA crop progress report confirmed good growing conditions, before prices recovered. U.S. soybeans were rated in 72 percent good-to-excellent condition by the U.S. Department of Agriculture, steady from a week ago and above last year's 63 percent.
The agency said 74 percent of the corn crop was in good-to-excellent condition, the same as a week ago and above last year's 69 percent. Corn hit a seven-year low on Friday following the USDA's monthly supply and demand report that projected record U.S. production for corn as well as soybeans.
But prices have since recovered, supported by the strength in soybeans and doubts as to whether corn yields will be as high as the USDA estimates.
"(For corn) market chatter suggests there is plenty of skepticism over whether the record U.S. corn yields forecast by the USDA will come to fruition," said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.
Corn was up 0.2 percent to $3.37-1/2 a bushel, while wheat gave up 0.8 percent to $4.18-3/4 a bushel.
Wheat prices remained capped by ample global supplies, despite rising prices in rival exporter Russia and expectations that the United States could draw export demand later in the season after a poor harvest in parts of western Europe.