Chicago corn and soybean futures edged higher on Friday, with bargain-buying lifting prices after both markets dropped to their lowest levels in three years, although plentiful supplies arelikely to limit gains.
Wheat rose for a second session on supply concerns as potential U.S. sanctions against top global wheat exporter Russia could hit flows.
“As has been the case for some time now, the principal cause of price declines remains the improved international production outlook, built upon expectations for large harvests in major grain exporters, including Brazil and Russia,” BMI, a unit of Fitch Solutions, said in a report.
“Meanwhile, the recent strength of the U.S. dollar has also weighed on the prices of agricultural commodities.”
The most-active soybean contract on the Chicago Board of Trade (CBOT) Sv1 rose 0.2% to$11.55-1/4a bushel, as of 0346 GMT, having dropped 1.5% this week.
Corn Cv1 added 0.4% to $4.20-1/4 a bushel, having gained almost 1%this week. Wheat Wv1, which is set for a weekly gain of 3.9%, was up 0.5% at $5.82-1/4 a bushel.
Corn and soybean prices dropped to their lowest levels since late 2020 on Thursday.
Expectations of higher corn and soybeans production in top South American producers – Brazil and Argentina – are weighing on Chicago futures.
Argentina’s corn and soybean crops continue to improve due to recent rains, the Buenos Aires grains exchange said on Thursday, with more rainfall expected in the coming days after wet weather conditions helped curb damages from a heat wave last month.
Argentina’s Rosario Grains Exchange cut its estimates this week for the country’s 2023/24 soybean and corn harvests, but the 49.5 million metric tons of soy and 57 million tons of corn are still a huge improvement from the previous year.
Following a record-large U.S. corn harvest in 2023, outlooks for rising grain stockpiles and falling Chinese demand for animal feed have spurred speculators to build massive net short positions in corn and soybean futures.