Soybeans rose 0.5% to $371.38 a tonne. The most-active CBOT wheat contract was down 0.4% to $210.81 a tonne. Corn was down 0.2% to $162.
The futures of the Soybeans rose on Wednesday on the Chicago Board of Trade (CBOT) due to a round of short covering triggered by the concerns about hot, dry weather in Brazil, world’s top producer, which could threaten planting, traders said, following the Fed’s 50 basis point cut in the rate.
Corn was slightly lower as industry players were reluctant to make big moves in the early stages of the U.S. harvest. Wheat prices were volatile as traders weighed declining European Union wheat yields against a strong flow of Black Sea exports.
Soybeans rose 0.5% to $371.38 a tonne. The contract of CBOT’s most active wheat fell 0.4% to US$210.81 per ton. Meanwhile, corn lost 0.2% to $162.
The US Federal Reserve (Fed) on Wednesday cut its rates for the first time since 2020, opting for a sharp half-percentage point cut to 4.75-5.00%. The US central bank plans to end the year with an additional half-percentage point cut, it said in a statement in which it expressed “greater confidence” in a decline in inflation in the United States. The Fed also revised its inflation forecast downward to 2.3% by the end of this year and 2.1% by 2025, while its unemployment forecast rose to 4.4% for 2024 and next year.
Concerns about hot and dry weather in Brazil
A delayed rainy season in Brazil has led to a depletion of humidity levels in some areas of the country, including Mato Grosso, one of the main soybean producing states in the country, according to a note from Maxar analysts.
However, Brazil’s statistics agency Conab on Tuesday projected the country’s 2024/25 soybean crop at 166.28 million metric tons, up 12.8% from the previous season.
Traders said the lack of rain will not be alarming unless the drought extends into October, which could seriously delay soybean planting.
In the United States, traders are closely monitoring the harvests of Soybeans and cornwhich are advancing rapidly and are expected to produce extraordinary returns.
Expectations of high yields have put heavy pressure on Chicago soybean and corn futures, although rains forecast for this weekend in parts of the US Midwest could hamper the harvest in some areas.
Cheap Black Sea wheat exports continued to weigh on prices, despite damaging dry weather affecting some Black Sea crops and a reduced forecast for French soft wheat exports.
Source: Ambito
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