The reasons for the decline lay in the Argentina’s decision to offer farmers a better exchange rate for soybeans, which “threatened to increase export competition at a time when US offers usually dominate the market, which tended to underpin declines”, explained the Rosario Stock Exchange (BCR).
On Sunday, the Minister of Economy, Serge Massa, announced a exchange rate of $200 for exports of soybeans and derivatives, what raised the price paid to the producer on Monday from $50,000 to $70,000 a ton on average and speeded up the sale of merchandise.
“In short, the increase in supply in the short term produced price decreases,” maintained the stock market entity.
The grain broker Granar agreed with this analysis and assured that “The main bearish factor from the beginning to the end of the day was Argentina, due to the increase in sales that materialized yesterday in the middle of the US holiday.”
Additionally, expectations of a record US soybean production have acted as an anchor on prices as farmers prepare for the harvest.
Soybean by-products accompanied the downward trend, with a Oil drop of 3.4% (US$56) to US$1,520.28 per tonwhile flour fell 2.4% (US$11.68) to position itself at US$477.84 per ton.
Corn price in Chicago, Tuesday, September 6
For its part, corn rose 1.8% (US$4.63) to close at US$268 a ton, as a consequence of “Miscellaneous Concerns Over Crop Shortages in US Midwest”.
In addition, while the market is awaiting the next report from the United States Department of Agriculture (USDA), The agency is expected to rate 53% of the country’s corn in good to excellent condition, down one percentage point from the previous week’s ratings, which tended to support price hikes.
Wheat price in Chicago, Tuesday, September 6
Finally, Wheat advanced 0.9% (US$2.57) and stood at US$293.95 per ton, because “Recent rains in the North American country will provide a much-needed boost to soil moisture ahead of winter crop planting,” indicated the BCR.
Source: Ambito
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