February 26, 2020 / 11:04 AM / a month ago

GRAINS-Prices subdued as spread of coronavirus fuels demand fears

* Wheat, corn fall for 5th of last 6 sessions on virus worries

* Demand risks hang over grains after slight recovery Tuesday

* Short-term importer buying lends some support to prices (Updates with European trading, changes byline/dateline)

By Gus Trompiz and Naveen Thukral

PARIS/SINGAPORE, Feb 26 (Reuters) - Chicago wheat, corn and soybean futures edged lower on Wednesday as concern economic growth will be hurt by the spread of coronavirus curbed a modest recovery on crop markets the day before.

Severe disruption to economic activity in China, where the virus first developed and has killed more than 2,700 people, has already dampened hopes for increased Chinese imports of U.S. agricultural supplies - as called for under a “Phase 1” trade agreement between Washington and Beijing.

The risk of a wider impact on demand was adding to concern on grain markets, although steady short-term buying by importers was helping underpin prices.

World share prices fell for a fifth day on Wednesday after a U.S. health agency warned of a possible global pandemic following a sharp rise in coronavirus infections in South Korea, Italy and Iran and outbreaks in a number of other countries.

Grain futures slumped to multi-month lows on Monday, before recovering slightly on Tuesday.

“Demand is raising questions, with an economic impact possibly strong on global growth,” consultancy Agritel said.

“Wheat seems the most fragile since the funds are in a long net position on this product, which could lead to profit-taking, or to a market trend reversal.”

The most-active wheat contract on the Chicago Board Of Trade

was down 0.4% at $5.34-3/4 a bushel as of 1047 GMT.

On Tuesday, the contract had ended up marginally after setting a new two-month low earlier in the session.

In Europe, May milling wheat on Euronext was unchanged on the day at 188.50 euros ($204.86) a tonne.

CBOT corn was down 0.3% at $3.75-1/4 a bushel, while soybeans ticked 0.1% lower to $8.87 a bushel.

Brisk demand from importers, including wheat purchases by Saudi Arabia and Tunisia along with corn purchases by South Korean buyers, were helping put a floor under the market.

However, an expected rise in U.S. corn plantings as well as favourable growing conditions for winter wheat in the Black Sea region and for soybean crops in South America were limiting upside for prices, analysts said.

Ukraine may harvest another good grain crop in 2020 due to clement weather conditions this winter, a senior state weather forecaster said on Tuesday.

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

($1 = 0.9201 euros)

Reporting by Gus Trompiz and Forrest Crellin in Paris and Naveen Thukral in Singapore, Editing by Sherry Jacob-Phillips and Mark Potter

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below