June 19, 2018 / 3:47 AM / 10 months ago

GRAINS-Soybeans drop to 2-year low on weather, trade war concerns

    * Soybeans down 2 pct to weakest since March 2016
    * Corn falls for 5th session, at lowest since Jan
    * U.S.-China trade was seen hitting U.S. bean exports 
    * Wheat struggles as U.S. winter crop harvest expands

 (Recasts with details, quotes)
    By Naveen Thukral
    SINGAPORE, June 19 (Reuters) - Chicago soybeans slid 2
percent on Tuesday to their lowest since March 2016, while corn
dropped for a fifth consecutive session on concerns over a
deepening trade war between Washington and Beijing.
    Wheat lost more ground on pressure from the rapidly
expanding U.S. winter crop harvest. 
    "China has set higher tariffs on U.S. beans which means
Brazil will grab a bigger share of the Chinese markets," said
Phin Ziebell, agribusiness economist at National Australia Bank.
    "At the same time we are seeing very good crop weather in
much of the U.S. Midwest."
    The Chicago Board of Trade most-active soybean contract
 dropped to a low of $8.87-1/2 a bushel, the weakest since
March 2016. It was trading down 2.1 percent at $8.89-1/2 a
bushel by 0327 GMT.
    Corn slid 2 percent to $3.49 a bushel, the lowest
since January and wheat fell 0.7 percent to $4.86-1/2 a
    U.S. soybeans are set to lose market share in China, the
biggest bean importer, as trade tensions escalate between the
two nations.
    U.S. President Donald Trump last week announced hefty
tariffs on $50 billion in Chinese imports, and China hit back,
announcing 25 percent tariffs on 659 U.S. goods, including
soybeans, starting July 6.
    China's most-active soymeal futures rose as much as
5 percent to 3,095 yuan a tonne as the market opened after
Beijing's move to slap 25 percent import duty on soybean from
the United States.
    There is additional pressure on corn and soybean prices from
crop-friendly weather across the U.S. Midwest which is boosting
    After market hours on Monday, the U.S. Department of
Agriculture said 78 percent of the corn crop was in good to
excellent condition as compared with 77 percent a week ago and
above last year's 67 percent.
    For soybeans, the agency said 73 percent of the crop was in
good to excellent condition versus 74 percent a week ago and 67
percent at the same time last year.
    Brazil's soybean trading has practically ground to a halt as
uncertainty over freight costs has kept buyers and sellers at
bay despite expectations of stronger sales after an escalation
of the U.S.-China trade fight, brokers and farmers said on
    Commodity funds were net sellers of CBOT corn, wheat and
soymeal futures contracts on Monday and net buyers of soybeans
and soyoil, traders said.

 Grains prices at 0327 GMT
 Contract    Last    Change  Pct chg  Two-day chg  MA 30   RSI
 CBOT wheat  486.50  -3.50   -0.71%   -2.99%       513.74  31
 CBOT corn   349.00  -7.00   -1.97%   -3.86%       389.90  20
 CBOT soy    889.50  -19.00  -2.09%   -4.07%       995.80  10
 CBOT rice   12.75   $0.00   +0.04%   +3.62%       $12.02  76
 WTI crude   65.50   -$0.35  -0.53%   +0.68%       $68.35  40
 Euro/dlr    $1.164  $0.007  +0.62%   -1.27%               
 USD/AUD     0.7411  -0.007  -0.90%   -2.18%               
 Most active contracts
 Wheat, corn and soy US cents/bushel. Rice: USD per
 RSI 14, exponential

 (Reporting by Naveen Thukral; Editing by Sunil Nair)
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