GRAINS-Chicago soya beans slip after rally, corn and wheat rise
Chicago soybean futures eased on Wednesday as traders booked profit following a three day price rally, driven by soyoil strength and the broader market for energy. Meanwhile, ongoing tariff uncertainty limited further gains.
The most active soybean contracts fell 0.23%, to $10.72 a bushel. However, it was still near its one-month high.
The rising energy prices, fueled by the escalating tensions in Israel and Iran, have supported agricultural commodities like soybeans and corn. The higher crude oil price makes soyoil, corn and other biofuel feedstocks more competitive.
Brent crude futures increased 0.3%, to $76.71 per barrel as of 0440 GMT. U.S. West Texas Intermediate Crude Futures increased 0.5% to $75.19 a barrel.
Market participants closely monitor developments in U.S. Biofuel policy.
The tax bill that was proposed on Monday by the Senate Republicans would extend the clean fuel tax credit until 2031, but it would reduce its value for biofuels derived from feedstocks outside of the United States by 20%.
Traders are also monitoring the development of tariffs between Washington and Beijing, which is the largest buyer for U.S. soy beans.
China's decision to reduce the use of soymeal in animal feed may result in a reduction of soybean imports from around 10 million tons per year by 2030. This would ease its dependence on foreign supplies.
According to Anec (a Brazilian trade association representing grain exporters), the top soy producer Brazil is expected to export 14.37 million tonnes of soy in June. This is up from 14.08 millions tons exported in the week prior.
Corn futures rose by 0.17%, to $4.32 a bushel. This was due to the uncertainty surrounding crop weather conditions in the U.S. Midwest. Traders are awaiting more precise forecasts.
Wheat futures increased 0.32%, to $5.51 a bushel. This was due to a lower-than-average U.S. harvest of winter wheat, which only reached 10% completion compared to 12% on average over the past five years.
(source: Reuters)
