Soybean prices are up in Chicago following the news that Joe Biden is dropping out of the presidential race. Last week, the price had hit its lowest level since 2020.
After hitting 2020 lows last week, Chicago soybean prices rebound on Monday by a wave of short covering. Market speculation is that Joe Biden’s withdrawal from the US presidential race could reduce the chances of Republican candidate Donald Trump being elected and potentially restart a trade war with the world’s top soybean buyer, China.
The most active contract of soy rose 1% to US$407.30 the ton, while the corn gained 2.2% to u$s157 lper ton. For its part, the contract for wheat The most active group added 0.5%, US$200.
Corn futures advanced as market participants unwound short positions placed in anticipation of a possible second Trump presidency.
Some market participants unwinding this “Trump trade” were reassessing the presidential race and what impact a Democratic winner might have on global commodity markets, said Angie Setzer, a partner at Consus Ag. “There is some market support for the idea that a Trump victory is not a certainty”he added.
Wheat futures were also strengthened by the concerns about the climate in the United States as traders adjusted positions ahead of the Department of Agriculture’s weekly crop progress report due later on Monday, warned StoneX commodity risk manager Matt Ammermann.
Concerns about crop developments in other regions also boosted commodities. The European Union’s crop monitoring service, MARS, cut most of its forecasts for average EU cereal yields this year, with the sharpest declines for maize and sunflowers, which suffered from hot, dry weather in the south-east of the bloc.
The IKAR consultancy on Friday lowered its forecast for Russia’s 2024 grain crop. Meanwhile, buyer interest has recently been reinforced by a slump in U.S. grain and oilseed prices. On Monday, U.S. exporters sold 133,000 metric tons of corn to Mexico for delivery in the 2024/25 season, the U.S. Department of Agriculture reported.
Source: Ambito
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