Chicago futures rise on prospects of production slump

CHICAGO SOYBEAN futures were firmer in Asian trading on Monday on worries over a sharp reduction in production in drought-hit Argentina despite some relief from recent rains, with strong US exports this month also providing support.

Wheat futures also rose as a cold snap in the US Plains fanned concerns about supply along with potential escalations in the Russia-Ukraine war.

Corn prices also advanced as traders watched for signs of fresh demand from China.

The most-active soybean contract on the Chicago Board of Trade (CBOT) was up 1% at $15.24-1/2 a bushel, as of 0312 GMT. Wheat rose 0.6% to $7.541/2 a bushel and corn gained 0.4% to $6.85-1/2 a bushel.

Large speculators raised their net long position in CBOT corn futures in the week ended Jan. 24, regulatory data released on Friday showed.

The Commodity Futures Trading Commission’s weekly commitments of traders report also showed that non-commercial traders, a category that includes hedge funds, increased their net short position in CBOT wheat and cut their net long position in soybeans.

China is likely to import a “substantial amount” of Brazilian corn, according to a report issued by the US Department of Agriculture’s (USDA) Foreign Agricultural Service post in Beijing.

Egypt’s state grains buyer announced a tender to supply yellow corn on a free-on-board basis for shipment between Feb. 20 and March 10.

The USDA confirmed a flurry of private sales of US corn and soybeans in recent days, although no new sales were announced on Friday.

The grains markets have also received additional support from concerns that the crops of key supplier Ukraine will be smaller due to the war, and that Russia’s crop also will fall below expectations.

Russian missile strikes killed three people in the southern Ukrainian city of Kherson while fighting raged in the eastern Donetsk region where Russia again shelled the key town of Vuhledar, Ukrainian officials said.

Commodity funds were net sellers of CBOT wheat, soybean, soymeal and soyoil futures contracts on Friday, traders said.

Asian shares started cautiously on Monday in a week that is certain to see interest rates rise in Europe and the United States, along with US jobs and wage data that may influence how much further they still have to go. —