By Paulo Trevisani
--Soybeans for November delivery fell 1.4% to $10.26 3/4 a bushel on the Chicago Board of Trade as U.S. production is expected to be robust.
--Corn for December delivery fell 0.4% to $4.05 1/4 a bushel
--Wheat for September delivery rose 0.7% to $5.43 1/4 a bushel
HIGHLIGHTS
Rally Paused: Grain futures gave up some of Monday's gains, which analysts attributed, in part, to money moving out of global stock markets into commodities. On Tuesday, agriculture markets focused on record large U.S. corn and soybean yield potential, AgResource said in a note. "The CBOT had rallied in recent days on managed money short covering amid the return of Chinese demand," for U.S. soybeans, the agricultural services firm said, adding that good crop ratings "offered pause in the rally."
Robust Beans: Soybeans futures gave up Monday's gains amid expectations of sound crop yields. AgResource said that managed money sold soybeans, while buying wheat and corn. It also said the USDA didn't announce any new daily soybean sales Tuesday, after China booked two-to-six cargoes of U.S. soybeans for October. "Today's soybean break is on limited volume and a recovery seems like a good bet for Wednesday amid an oilseed crush workers strike in Argentina," AgResource said, adding that bearish bets are based on rising U.S. grain yields expected for Monday's crop progress report.
Promising Crops: The U.S. Central Plains and Missouri Valley regions will experience a bout of above normal temperatures this month, "severely stressing summer crops and creating dangerous conditions for livestock," forecaster Planalytics said in a note. But the heat wave will be soon followed by another cooldown. Planalytics expects weather to remain mostly favorable for crops, as "the chance for showers and storms will continue, keeping yield prospects robust." The positive crops outlook has been weighing down on prices, although futures are mostly higher today.
INSIGHT
Debby's Threat: Flooding from tropical storm Debby has damaged crops in Florida and is bound to cause damage in the Carolinas in areas of low-lying fields, said Terry Reilly of Marex. There would likely be more of an impact on soybeans than corn in the event of localized flooding, although assessment of bushels per acre lost will probably take until September since August data has already been collected, he said. "If anything it would be a small dent in the U.S. production, but it could be a little bit of a yield drag." The meandering storm is expected to move offshore the coast of Georgia today and move inland over South Carolina Thursday, according to the National Hurricane Center.
Ukrainian Crops: Black Sea consultancy SovEcon lowered production and export estimates for Ukraine crops. The corn estimate fell to 25.6 million from 27.6 million metric tons, with the export forecast declining to 21 million from 22 million tons. The wheat production outlook is now 19.7 million tons, down from 20.4 million tons a month ago, with the export forecast cut to 13.4 million tons from 13.6 million tons. "The significant cut in the corn crop forecast is due to unfavorable weather conditions," SovEcon's Andrey Sizov said in a note. As for wheat, dry weather in May affected the yield potential, Sizov said.
AHEAD
--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.
--The USDA will release its weekly export sales report at 8:30 a.m. ET Thursday.
--The CFTC will release its weekly Commitment of Traders report at 3:30 p.m. ET Friday.
Anthony Harrup contributed in this article.
Write to Paulo Trevisani at paulo.trevisani@wsj.com
(END) Dow Jones Newswires
08-06-24 1524ET
