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GRAINS-Soybeans drop on China's currency fall; wheat, corn firm
August 12, 2015 / 9:59 AM / 2 years ago

GRAINS-Soybeans drop on China's currency fall; wheat, corn firm

* Soybeans fall on Chinese devaluation
    * Corn, wheat up as dollar weakens
    * Coming up: USDA world supply/demand report at 1600 GMT

 (Writes through after start of European trading, changes byline/dateline)
    By Michael Hogan and Naveen Thukral
    HAMBURG/SINGAPORE, Aug 12 (Reuters) - Chicago soybean futures fell on
Wednesday, pressured as China again allowed its currency to lose value, creating
worry Chinese soybean imports could be reduced.
    Corn and wheat firmed, giving up earlier losses, after China's effective
devaluation caused the dollar to weaken.
    Corn and wheat were also underpinned by bargain-buying ahead of the monthly
world supply and demand report from the U.S. Department of Agriculture (USDA)
due 1600 GMT on Wednesday.
    Chicago Board of Trade new crop November soybeans fell 0.6 percent to
$9.64-3/4 a bushel by 0949 GMT, having closed down over 2 percent on Tuesday.
    September corn rose 0.3 percent to $3.77-3/4 a bushel, after falling
about 3 percent on Tuesday. September wheat rose 0.3 percent to $5.09 a
bushel.
    "Soybeans are under the most pressure today because of the Chinese currency
devaluation," said Frank Rijkers, agrifood economist at ABN AMRO Bank. "China is
the world's largest soybean importer and its devaluation will make its imports
more expensive." 
    "This could put downward pressure on China's soybean import volumes." 
    China again let the yuan fall on Wednesday after Tuesday's devaluation.
 But the dollar weakened on believe China's move could delay a
U.S. rate rise. 
    "Wheat and corn are firmer, moving in and out of positive territory, with
support coming from the weaker U.S. dollar in the fallout following the Chinese
devaluation," Rijkers said.
    "The weaker dollar, especially against the euro, will improve U.S. wheat
export prospects." 
    "There is some bargain buying of wheat and corn today ahead of the USDA
report, but the Chinese news has overshadowed the USDA."
    China imported a record 9.5 million tonnes of soybeans in July, up 17.4
percent from 8.09 million tonnes in June. 
    The USDA will announce its latest U.S. and global crop production estimates
on Wednesday. Heavy flooding during the spring in southern and eastern growing
areas of the United States will prompt the U.S. Department of Agriculture to
trim its estimates of both soybean yields and acreage, analysts
said. 
    Grains prices at  0947 GMT                    
 
  Contract        Last    Change  Pct chg  Two-day chg MA 30   RSI 
  CBOT wheat     507.75     0.50  +0.10%    -3.38%     536.21   44
  CBOT corn      388.25     0.75  +0.19%    -3.18%     410.45   46
  CBOT soy       964.25    -7.25  -0.75%    -3.04%     983.28   51
  CBOT rice      $11.79    $0.00  +0.00%    -0.59%     $11.17   73
  WTI crude      $43.42    $0.34  +0.79%    -3.43%     $49.22   28
  Currencies                                                
  Euro/dlr       $1.1131
            
 Most active contracts                    
 Wheat, corn and soy US cents/bushel. Rice: USD per hundredweight               
    
 RSI 14, exponential                    

 (Reporting by Michael Hogan and Naveen Thukral, editing by William Hardy)

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