July 6, 2018 / 3:37 AM / 9 months ago

GRAINS-Soybeans little changed after hitting contract-low on U.S.-China trade war

    * Soybeans almost flat as market awaits U.S.-China tariffs
    * Wheat eases after 2-session rally on global supply woes

 (Adds details, quote)
    By Naveen Thukral
    SINGAPORE, July 6 (Reuters) - U.S. new-crop soybean prices
were largely unchanged on Friday after dropping to a
contract-low earlier in the session as top importer China
prepared to impose additional tariffs on U.S. shipments amid a
trade war between the two nations.
    Wheat slid after two sessions of strong gains driven by
concerns over adverse weather.
    Chicago Board of Trade November soybeans hit a
contract-low at $8.53 a bushel and the market was trading down
quarter of a cent at $8.55-1/2 a bushel by 0311 GMT. The
most-active contract was trading above a 10-year low of
$8.42 a bushel marked last month.
    Wheat dropped 0.6 percent to $5.02-1/2 a bushel after
rising 5.3 percent in the last two sessions, while corn
gave up 0.6 percent to $3.62-1/4 a bushel.
    "The soybean market has largely factored in Chinese tariffs.
We expect Brazilian soybeans premium to rise further when the
tariffs start," said one India-based agricultural commodities
    China is poised to raise tariffs on U.S. soybeans on Friday
to a level that is expected to curb Chinese demand for U.S.
    President Donald Trump said on Thursday the United States
may ultimately impose tariffs on more than a half-trillion
dollars' worth of Chinese goods as the world's two largest
economies hurtled toward the start of a trade war.
    Brazil, the world's largest soybean exporter, may have to
import the oilseed from the United States this year to satisfy
demand from local processors, an executive of exporters
association Anec said on Thursday.
    If China's demand for Brazilian soy rises due to the trade
war with the United States, local processors may have to resort
to importing 500,000 to 1 million tonnes from the United States,
Luis Barbieri said at an event in Sao Paulo. 
    Private analytics firm Informa Economics revised upward its
forecast for the U.S. 2018 corn yield to 176.0 bushels per acre
(bpa), from 174.5 bpa previously, and raised its U.S. soybean
yield forecast to 49.8 bpa from 49.5 bpa, the firm said on
Thursday in a client note seen by Reuters.
    Wheat futures have rallied sharply in the last two sessions
on worries about smaller harvests from major exporters.
    The European Union may harvest almost 6 million tonnes less
wheat this year after hot and dry weather damaged some crops, a
Reuters poll showed.
    Commodity funds were net buyers of CBOT wheat and corn
futures contracts on Thursday and net sellers of soybeans,
soymeal and soyoil, traders said.
    Trader estimates of fund activity in corn ranged from
selling a net 6,000 contracts to buying a net 5,000 contracts.

 Grains prices at 0311 GMT
 Contract    Last    Change  Pct chg  Two-day chg  MA 30   RSI
 CBOT wheat  502.50  -3.00   -0.59%   +2.34%       516.23  58
 CBOT corn   362.25  -2.25   -0.62%   -0.55%       389.19  33
 CBOT soy    855.50  -0.25   -0.03%   -1.01%       953.38  9
 CBOT rice   11.91   $0.05   +0.42%   +2.45%       $11.66  55
 WTI crude   72.78   -$0.16  -0.22%   -1.83%       $68.27  65
 Euro/dlr    $1.169  $0.000  -0.03%   +0.27%               
 USD/AUD     0.7378  -0.001  -0.11%   -0.03%               

 (Reporting by Naveen Thukral
Editing by Joseph Radford and Sunil Nair)
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