GRAINS and soybeans slump due to 'greenhouse weather' in US
Chicago soybean futures eased Monday as favorable weather conditions in the U.S. took the attention away from the U.S. strike on Iran that occurred over the weekend.
The price of November soybeans dropped by 14 cents to $10.46-3/4 a bushel.
Chicago corn fell due to weather pressure and wheat also declined with an accelerated harvest.
Midwest Market Solutions president Brian Hoops said that the forecast for the week ending July 2 shows a warm and wet weather across the U.S. Corn Belt.
Hoops said that the weather would create a "near greenhouse effect" with benefits for corn, soybeans and other crops.
These conditions have outweighed the impact of the initial surge in oil prices after the U.S. attacked Iranian nuclear sites on the weekend.
Oil prices dropped 1% Monday, after hitting a five-month peak. Market players assessed the effect on the transit of oil and natural gas through the Strait of Hormuz following the U.S. airstrikes against Iran.
Because it is used as a biofuel to replace fossil fuel, the price of soy oil is closely linked to the crude oil market.
Karl Setzer, a partner at Consus Ag Consulting said that "the lack a story about the weather on the U.S. crops is more negative than any potential explosion between the U.S.
After hitting contract lows earlier, September corn fell 8 cents and ended at $4.17-1/2 a bushel.
September wheat ended down 14 cents to $5.69-1/2 per bushel.
Analysts predict that the weather in the United States will be favorable for harvesting wheat in the next few weeks.
Hoops said that "a warmer and dryer weather forecast is expected for the winter-wheat Plains. This should help to advance the harvest of winter wheat, while good rains are forecast for spring wheat belt."
Terry Reilly is a senior agricultural strategist with Marex. Renee Hickick in Chicago; Additional reporting by Ella Cao, Lewis Jackson and Sybille De La Hamaide in Beijing; Editing and production by Aurora Ellis
(source: Reuters)
