Market Trends: Chicago Soybeans Rise Ahead of U.S. Supply Report

BEIJING/PARIS, Nov 12 (Reuters) – Soybean prices on the Chicago Board of Trade (CBOT) saw an uptick on Wednesday as traders adjusted their positions in anticipation of the U.S. Department of Agriculture’s (USDA) official supply and demand report scheduled for Friday. Despite this increase, prices were limited by a noticeable absence of significant soybean purchases from China.

Current Price Movements

The most-active soybean contract rose 0.4% to $11.32 per bushel by 1120 GMT. Traders remain cautious as China has recently made modest purchases of U.S. agricultural commodities since high-level discussions between the country’s leaders last month. There is keen interest in potential large soybean deals after the White House indicated that Beijing had committed to buying 12 million tons of soybeans by the end of the year.

Chinese Purchases and Market Impact

In contrast, COFCO, China’s leading oilseed importer, announced on Monday its agreements worth over $10 billion to purchase Brazilian soybeans, soybean oil, palm oil, and other agricultural products. The statement notably omitted any mention of U.S. purchases, raising concerns regarding American exports.

Currently, China is dealing with an oversupply of soybeans following an extended period of record imports, which further clouds the prospects for significant purchases from the U.S. sector.

Expert Insights

“For U.S. soybeans to see stronger support, we need to witness China making significant purchases. However, the rallies may remain limited due to previously contracted sales from South America and substantial current stocks,” stated Josh Lawrence, an adviser at IKON Commodities in Sydney.

Other Commodity Movements

In related commodities, corn prices advanced slightly by 0.1% to $4.32-1/2 per bushel, reflecting concerns over drought conditions and diseases affecting the U.S. corn crop’s yield and quality. Wheat, on the other hand, saw a modest decline of 0.7%, settling at $5.47-3/4 per bushel.

Upcoming USDA Report

Market participants are eagerly awaiting the USDA report, making necessary adjustments to their positions in light of anticipated changes. A recent Reuters poll of analysts predicts a reduction in the USDA’s U.S. corn yield estimate, projecting it to fall to 184.0 bushels per acre from a previous forecast of 186.7 bushels per acre. Furthermore, analysts have estimated the U.S. soybean yield to be 53.1 bushels per acre, a drop from the earlier 53.5 bushels.

Market Summary

Reporting by Ella Cao and Lewis Jackson in Beijing and Sybille de La Hamaide in Paris. Editing by Ronojoy Mazumdar and Mark Potter.