Soybeans Stay Weak On Coronavirus Demand Risks
Chicago soybeans edged lower on Tuesday as the risk of a drop in demand due to the coronavirus crisis hung over the market, underlined by the closure of several U.S. meat factories.
Corn, partly used for ethanol biofuel, also inched lower as it tracked hesitant movements in crude oil markets, while wheat eased as steady U.S. crop ratings tempered concern about possible frost damage in parts of the U.S. Plains.
The most-active soybean contract on the Chicago Board Of Trade (CBOT) was down 0.2% at $8.52-3/4 a bushel as of 1236 GMT, after losing more than 1% on Monday.
The contract had risen slightly in Asian trading and remained above Monday's one-week low of $8.50-1/2.
Several U.S. meat processing plants temporarily closed in the last week after outbreaks of the coronavirus among workers, prompting fears of a knock-on effect on demand for soymeal widely used in feeding livestock.
Soybean imports by China, the world's biggest buyer, fell 13% in March from a year earlier to a more than five-year low, customs data showed on Tuesday, after rains delayed cargoes from Brazil and as the coronavirus outbreak dented demand.
Corn inched down 0.2% to $3.30-3/4 a bushel and wheat slipped 1.3% to $5.48-1/2 a bushel.
A plunge in fuel consumption as many countries impose lockdown measures to curb the coronavirus was keeping corn near a 3-1/2 year low.
Crude oil has regained some ground as weekend talks between producer countries yielded a deal on sharp output cuts, but the collapse in global demand tempered reaction to the agreement.
"Corn futures prices remained rooted to recent lows after trading on Monday," said Tobin Gorey, director of agriculture strategy, Commonwealth Bank of Australia. "Corn prices did zig and zag with oil prices but ultimately that came to nothing."
Curbed Grain Prices
Recent crop estimates from the U.S. Department of Agriculture (USDA) have also curbed grain prices.
The USDA last week raised its outlook for U.S. stocks of corn, wheat and soybeans due to the effects of the coronavirus pandemic, while in an end-March report it projected higher than expected U.S. corn plantings this year.
In a weekly crop report released after the market close on Monday, the USDA estimated that 62% of U.S. winter wheat was in good or excellent condition, stable on the week and slightly above the year-earlier score.
The favourable U.S. crop ratings took attention away from a potentially damaging frost episode in part of the U.S. Plains as well as dry conditions in Europe and the Black Sea region.