Chicago Board of Trade (CBOT) soybean and corn futures dipped on Thursday after the U.S. Department of Agriculture (USDA) released its weekly export sales report that disappointed analysts.
China, which is in a trade war with the United States and needs fewer soybeans as swine fever ravishes its pig herd, canceled 148,400 metric tonnes of U.S. soybean orders, data showed.
Overall soybean export sales were the lowest in 11 weeks.
“This is a reminder of how small the demand side is,” said Don Roose, president of consultancy U.S. Commodities. “This report is just simply disappointing.”
Traders also continue to focus on the extent to which further hot, dry weather could threaten U.S. corn yields.
Very hot and dry weather could return to the U.S. Midwest in the next two weeks, particularly in parts of major producing states Illinois, Iowa and Indiana, according to a report by Commodity Weather Group on Wednesday.
The most active soybean futures on the Chicago Board Of Trade settled down 8-1/2 cents at $8.99-3/4 a bushel at close. Corn futures settled down 3-1/4 cents, to $4.27 a bushel.
Meanwhile, wheat gained on reports of smaller than expected harvests and some export sales. The most active CBOT future settled up 1-3/4 cents, to $4.99-1/2 a bushel.
The International Grains Council cut its forecast for world wheat production in the 2019/2020 season, reflecting diminished crop outlooks in Russia, the European Union and Canada.
The wheat harvest in U.S. states like North Dakota is expected to fall below the typical average, scouts on an annual crop tour said on Wednesday.
According to sources, a group of five crushers were told by China’s state planner they could apply for exemptions from tariffs on some U.S. soybean cargoes arriving before the end of December. However, Chinese firms are in little hurry to buy as they grapple with poor margins and longer-term doubts about Sino-U.S. trade relations.
Top U.S. and Chinese negotiators will meet face-to-face next week for the first time since leaders of both countries agreed in June to revive talks aimed at ending a year-long trade war between the world’s two largest economies.
China imposed a 25% tariff on U.S. soy imports last year as Washington-Beijing trade disagreements boiled over into tit-for-tat levies on each other’s goods.