Profit-taking slips soybeans
U.S. soybean futures eased further Tuesday, pressured by profit-taking ahead of a key government-crop report due later this week.
The most-active soybean contract slipped for a second consecutive session as the market continued to consolidate after a 13% rally in August on concerns that hot, dry weather in the Midwest would reduce the size of this year's crop.
Weather forecasts Tuesday called for light rains in Illinois, Indiana and Iowa--all big soybean producers--over the next week, though analysts said the moisture may come too late to significantly help the crop.
Rich Nelson, director of research at brokerage Allendale Inc., said the rain could boost soybean yields by a 10th to a fifth of a bushel, but "this is not going to change the overall problem of lower production."
Chicago Board of Trade soybean futures for November delivery, the most actively traded contract, fell 1 1/2 cents, or 0.1%, to $13.55 a bushel Tuesday. September soybean futures, lightly traded ahead of their expiration Friday, declined 1/2 cent, or 0.04%, to $14.03 3/4 a bushel.
The soybean crop is currently more vulnerable to damage than the corn crop because it has a later growing season. The USDA rated 52% of the domestic soy crop in good to excellent condition as of Sunday, down from 64% at the start of the month.
Analysts expect the U.S. Department of Agriculture to cut projected domestic soybean output this year by 3.3%, to 3.15 billion bushels, from its forecast last month, in its supply-and-demand estimates due Thursday, according to a Wall Street Journal survey.
Corn largely underwent its main development stage in July, when conditions were more favorable. Analysts are calling for a 0.9% reduction in corn production in Thursday's report, but output is still expected to be a record.
"Don't expect these markets to do a whole lot until we see those reports," said Jack Scoville, vice president at Price Futures Group in Chicago. But with the harvests coming up, the "seasonal tendency is to go down."
Corn futures settled mostly higher Tuesday as that market consolidated after a recent slide in prices ahead of the USDA report. "For corn, there has been some profit taking here today from shorts," or traders who had bet on price declines, Mr. Nelson said.
Most-active December corn climbed 5 1/2 cents, or 1.2%, to $4.69 a bushel. Thinly traded corn for September delivery fell 2 1/2 cents, or 0.5%, to $4.74 3/4 a bushel.
Wheat futures, which often trade in tandem with corn, ended higher, with the most-active wheat contract for December delivery gaining 5 1/4 cents, or 0.8%, to $6.46 1/2 a bushel.
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(END) Dow Jones Newswires
September 10, 2013 15:34 ET (19:34 GMT)
DJ Soybean Futures Edge Lower; Corn, Wheat Advance - Update->copyright
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