Soybeans Ease After Six-Week Top As Demand Assessed
Chicago soybeans edged lower on Thursday, easing back from a six-week high earlier in the session, as traders weighed up demand prospects following an increase to export duties in rival supplier Argentina and amid uncertainty over Chinese imports.
Corn also eased after striking a five-week top a day earlier, with renewed weakness in share and commodity prices keeping attention on risks related to the coronavirus that is spreading around the world.
U.S. wheat was almost unchanged as it continued to hover near Monday's three-month low after fears about the coronavirus prompted investors to reduce long positions.
Grain markets were awaiting weekly U.S. export sales at 1330 GMT for a fresh indication on overseas demand.
"We know that the coronavirus has slowed down global trade in agriculture products and caused wild swings in broader equity and commodity markets," said Phin Ziebell, agribusiness economist at National Australia Bank.
"For soybeans, there are pretty good supplies but there could be higher demand for U.S. beans, given the higher taxes in Argentina."
Argentina's announced on Tuesday that it plans to raise taxes on soybean, soyoil and soymeal exports to 33% from 30%.
The possibility of reduced competition from Argentine soy has turned attention back to China's commitment to ramp up purchases of U.S. agricultural goods under a trade deal with Washington.
Recent Chinese purchases of U.S. sorghum raised hopes they could be followed by U.S. soybeans, and U.S. Agriculture Secretary Sonny Perdue told Congress on Wednesday China was expected to buy U.S. soy in late spring and summer.
However, disruption to China's economy due to the coronavirus that originated there, along with the continuing effects of a pig fever epidemic, were clouding the outlook.
"Chinese demand is being dampened by the outbreak of African swine fever and by coronavirus, so it is questionable whether China will really reach its ambitious purchase targets," Commerzbank said in a note.
The most-active soybean contract on the Chicago Board Of Trade was down 0.3% at $9.04-3/4 a bushel by 1217 GMT, after reaching its highest since 23 January at $9.12-1/2 earlier in the day.
CBOT corn lost 0.8% to $3.81-3/4 a bushel, having hit a five-week high of $3.86-3/4 on Wednesday.
Wheat was up 0.1% at $5.18-3/4 a bushel as it continued to hold above Monday's low of $5.13.
European shares fell on Thursday as U.S. equity futures pointed to a lower open for Wall Street as coronavirus cases surged in the United States.
Share prices had regained some ground this week after policy steps, notably a U.S. Federal Reserve interest rate cut on Tuesday, to soften the impact of the coronavirus.