GRAINS - Argentine rains dampen corn and soy markets
January 06, 2014
Reuters 30 December 2013
* Rains across Argentina ease drought stress on crops
* USDA corn export figures put a brake on losses
* Wheat falls, gives back some gains from prior session (Updates to
include U.S. trading session, adds fresh weather information, adds
Rosario grain exchange estimates, changes dateline from HAMBURG/SYDNEY)
By Sam Nelson
CHICAGO, Dec 30 (Reuters) - U.S. soybean and corn futures markets eased
on Monday with corn dropping to its lowest level in two weeks as rains
fell in key crop areas of major exporter Argentina, easing dought-stress
on each crop.
Crop-friendly rain fell over much of Argentina's corn and soybean
growing region over the weekend and more rain is expected in roughly the
northern two-thirds of the country, said John Dee, meteorologist for
Global Weather Monitoring.
"There was rain over the weekend of from 0.50 inch to 1.50 inches
(1.3-3.8 cm) in the north and under 0.50 inch in the south," he said.
It remained rather dry in the La Pampa and Buenos Aires growing region
but other areas of Argentina received welcome showers, according to Dee.
Dry weather is expected to return at the end of the week, he said.
"Rains continue to fall in nearly all areas of Brazil," Dee said.
Wheat slipped under pressure from the weakness in corn and on persistent
pressure from the abundant global stockpile of wheat, analysts said.
At 9:47 a.m. CST (1547 GMT), Chicago Board of Trade January soybeans
were down 3-1/4 cents per bushel at $13.28-1/4, March corn was down
2-1/4 at $4.25-1/4 and wheat for March delivery was down 3-1/2 at
"Soybeans and corn are being weakened by forecasts of more rain in
Argentina, wheat is drifting down in quiet holiday-season trade," said Arnaud Saulais of SCB Commodity Brokers.
"There had been concern about dry weather damaging soybean and corn
crops in Argentina. With forecasts of more rain in Argentina, this
concern will be reduced."
Argentina, the world's third-largest exporter of corn and soybeans, has
been suffering prolonged hot, dry weather that traders fear could damage
crops and has supported global prices. Weekend rain and forecasts of
more wet weather have improved the country's crop outlook.
"Soybeans and corn both rallied on Friday and with the rains in
Argentina coming at an important time for crop development, the market
has corrected fractionally lower," Garry Booth of brokerage ICAP said.
Argentina's Rosario grain exchange on Monday said Argentina will harvest
55.0 million tonnes of 2013/14 soy and 22.0 million tonnes of corn.
The U.S. Department of Agriculture (USDA) forecasts Argentina will
harvest 54.5 million tonnes of soybeans in the new 2013/14 crop, up from
49.3 million in the previous season. The Argentine corn crop is seen
little changed at 26 million tonnes.
"We could see more pressure on the market this week, although this is more likely to hit soybeans than corn," Saulais said.
"Corn is already at a relatively low level and there is also some
support still coming from the surprisingly good U.S. corn export figures
announced on Friday."
Corn and soybeans rallied on Friday following the release of the USDA's
latest export sales figures, which showed better-than-expected weekly
The USDA pegged net sales of corn for the 2013/14 marketing year at
nearly 1.5 million tonnes, far exceeding trade estimates, while soybean
exports of more than 720,000 tonnes also topped expectations.
Corn remained under background weakness from concern China is rejecting
imports that contain a genetically modified corn strain not yet approved
by Chinese authorities. (Additional reporting by Michael Hogan in
Hamburg and Colin Packham in Sydney; Editing by Marguerita Choy)