Soybeans Slip To 10 Year Low As US-China Trade Tensions Mount
Chicago soybean futures extended losses on Monday to set a ten year low as investors were discouraged by sharpening tensions in US-Chinese trade talks that have dampened hopes for a revival in soybean shipments.
Chicago corn and wheat edged lower as dimming prospects for a rapid resolution to the
tariff battle between Washington and Beijing led to broad losses in grain and wider financial markets.
Grain markets also remained under pressure from Friday's US Department of Agriculture (USDA) supply and demand report, which projected bigger than expected domestic supplies of soybeans, corn and wheat.
Prices were also pressured by forecasts for less-rainy weather than of late, which could help growers to catch up with delayed planting.
"The USDA report has added to the gloomy atmosphere in place on agricultural commodities due to the endless and tense trade discussions between the US and China," consultancy Agritel said.
US And China
The trade tussle between the world's top two economies intensified on Friday when the United States increased tariffs on $200 billion worth of Chinese goods, blaming Beijing for reneging on earlier commitments.
Trump also ordered US Trade Representative Robert Lighthizer to begin imposing tariffs on all remaining imports from China, which would affect a further $300 billion worth of goods.
Beijing on Monday said that China would never surrender to external pressure but stopped short of announcing how it would respond to US tariff pressure.
The USDA's crop forecasts on Friday, meanwhile, also cooled price sentiment by projecting bigger than expected domestic supplies of soybeans, corn and wheat.
Chicago Board Of Trade
The most-active soybean contract on the Chicago Board of Trade had dropped 0.8% to $8.02-1/2 a bushel by 10:42am GMT, having touched its lowest since December 2008 at $7.99-1/2.
CBOT corn lost 0.6% to $3.49-1/2 a bushel, close to Friday's near eight-month low of $3.45-1/2.
Wheat was down 0.3% at $4.23-1/2 a bushel after hitting its lowest since January 2018 at $4.21-1/4.
Traders are also watching weather developments after a soggy spring in the many U.S. grain belts has left corn and spring wheat planting well behind the usual pace.
"The latest weather model runs favour dryness over most of the corn and soy belts, which could help farmers recover some of the lost ground," Refinitiv agriculture research analysts said.
The USDA will publish its weekly crop progress report later on Monday.