Chicago Agriculture Commodities Finished Lower on the Week

Chicago Agriculture Commodities Finished Lower on the Week

$CORN, $WEAT, $SOYB

Chicago agriculture commodities finished lower on the week ended 8 December with a firmer USD putting additional pressure on US grain crop prices.

The most active Corn contract for March delivery fell 6 cents weekly, or 1.67%, to 3.5275 bu.

March Wheat delivery plunged 19.5 cents, or 4.45%, to 4.19 bu.

January Soybean went down 4.5 cent, or 0.45%, to 9.8975 bu on the week.

Not only CBOT Wheat, but also Wheat futures across the world settled lower with new contract lows. The downturn maintained through the whole week due to ample inventories and bigger-than-expected crop estimates in Canada.

The US Dollar (.DXY) Index, a measure of USD Vs a basket of other major currencies, has kept edging up during the week. A firmer USD makes CBOT commodities less competitive in world market.

Keen market observers believe that a demand driver is lacking to encourage much beyond short covering bounce in Wheat, but in longer term, the US balance sheet looks to tighten amid a loss of acres.

CBOT Corn followed the downturn in Wheat.

With the arrival of La Nina, the opposite weather pattern of El Nino, it will be difficult to sustain a lasting period of normal rainfall to Corn-growing Argentina and Brazil. Still, it is too early to determine the impact on MY 2018 Corn crop in South America.

As for Soybeans

The new weather conditions, especially the dryness to prevail in Argentina and southern Brazil this month already led to worries about soybean yields there, pushing up the prices earlier this week.

Speculative demand also played an important role in sparking a sharp rise in CBOT Soybean, with prices rebounding above the 10.00/bu mark for the 1st time since October.

Official statistics released last Thursday showed strong export sales of US Soybean recently, but YTD sales are still lagging behind last year. Amid profit-taking, Soybean suffered losses in 3 consecutive sessions during the week.

US Soybean supplies are record large, while China continues to import world Soybean at a record pace.

Agriculture analysts said the outlook for US Soybean prices now hinges on South American crops.

Have a terrific week.

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