CBOT Weekly: Soybeans, corn off lows, sideways trade likely through harvest

Soybean, corn and wheat futures in the United States were all showing modest strength in early September, recovering off their August lows as speculators bought back previously sold positions.

“We’re seeing a little bit of short covering in these markets and the contract lows, at least over the short term, may be in,” said Terry Reilly, senior agricultural strategist with Marex in Chicago.

Dryness concerns in parts of the Midwest were also supportive for soybeans especially, as condition ratings for the crop dipped in the latest weekly update from the U.S. Department of Agriculture, said Reilly adding that drought conditions were increasing in Ohio, Minnesota, Iowa and parts of Illinois.

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While there is a possibility of seasonal declines in both soybeans and corn during the harvest season, Reilly expected the large production prospects were generally priced into the market already.

“For now, as long as there’s no weather problem, I think we’ll just trade sideways.”

November soybeans hit a contract low of US$9.55 per bushel on Aug. 16 but has since risen back above the psychological US$10.00 per bushel level. December corn set its contract low at US$3.85 per bushel on Aug. 26 but was trading back above US$4.00 in early September.

For wheat, persistent weather problems in the European Union were underpinning values, with much of the Black Sea region too dry for planting winter wheat, said Reilly.

The December soft wheat contract in Chicago hit a low of US$5.2575 on Aug. 27 and was trading more than 50 cents above that level a week later.