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Soy at five-month low on big Brazil crop, wheat rallies on Black Sea doubts

Tan KW
Publish date: Fri, 24 Mar 2023, 10:33 PM
Tan KW
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PARIS/ SINGAPORE Chicago soybeans extended losses on Friday (March 24) to a five-month low as a bumper Brazilian harvest was seen flowing onto export markets, while wheat rebounded as a report Russia may consider halting exports revived uncertainty about Black Sea supply.

Corn tracked wheat higher to trade near Thursday's three-week high that was fuelled by a flurry of US exports to China.

Volatility in financial markets, with the dollar index rallying as investors remained wary of a banking crisis, was also hanging over grains, traders said. MKTS/GLOB

The most-active soybean contract on the Chicago Board of Trade (CBOT) Sv1 fell 0.7% to US$14.09-3/4 a bushel, by 1212 GMT, after dropping earlier to its lowest since end-October at US$14.05.

Harvesting of what is forecast to be a record Brazilian soybean crop has eased concern about drought losses in Argentina and raised the prospect of stiff export competition for US supplies.

"Talk of the big crop in Brazil which will help offset the Argentine crop, plus the rumours that there could be Brazilian soybeans moving towards the East Coast of the US helped to add to the bearish tone," commodities research firm Hightower said in a report.

Weekly US export sales of soybeans reported on Thursday, that came in below market estimates, reinforced expectations that Brazil will increasingly capture export demand.

CBOT wheat Wv1 climbed 3.0% to US$6.81-1/2 a bushel, breaking a four-session fall and moving away from a 20-month low struck on Wednesday.

Wheat has been pressured this week by the continuation of a wartime export corridor from Ukraine, falling Russian prices and improved weather for U.S. and European crops.

But a report in Russian business newspaper Vedomosti saying that Moscow could recommend a temporary halt in wheat and sunflower exports, in response to falling prices, helped the market to steady.

"The market is clearly reacting to this after the big price fall this week," a European trader said.

Any Russian restrictions could add to supply uncertainty in the Black Sea region after Moscow said last week it had only agreed to a reduced 60-day extension of the export corridor from Ukraine.

CBOT corn Cv1 added 0.8% to US$6.37 -1/4 a bushel.

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