CHICAGO — U.S. soybean futures declined on Thursday on spillover weakness from crude oil and expectations of a massive Brazilian soy harvest, but most-active soymeal futures set an 8-1/2 year high on tight supplies of the feed ingredient, analysts said.
Wheat futures fell on profit-taking after rising to a one-month top while corn inched higher.
As of 1:08 p.m. CST (1908 GMT), Chicago Board of Trade (CBOT) March soybeans were down 3-1/4 cents at $15.31 per bushel while March soymeal was up $4.60 at $496.40 per short ton after reaching $500.40, the highest price on a continuous chart of the most-active soymeal contract since June 2014.
Soymeal futures surged as worries about tightening supplies in Argentina, the world’s top exporter, and firm cash markets in the United States attracted speculative buying.
“The funds have been piling into soybean meal for some time now. Meal is tight in this country; our crush rates are not what you think they would be,” said Tom Fritz, a partner with EFG Group in Chicago.
Meanwhile, soybean futures sagged as traders anticipated a record-large soy harvest in Brazil, and as a drop in crude oil futures weighed on soyoil, used in biodiesel fuel. Crude oil declined after strong U.S. jobs data raised concerns about higher interest rates.
Some analysts also noted rising U.S. tensions with China, the biggest global importer of the oilseed, as a potential bearish factor for soybean futures after a Chinese spy balloon was tracked flying across the United States.
CBOT March wheat was down 5-1/4 cents at $7.55-3/4 per bushel, turning lower after rising to $7.76-1/2, its highest level in a month. March corn was up 1-1/4 cents at $6.76-1/2 a bushel.
A firmer dollar hung over the markets, making U.S. grains less competitive globally. The dollar rose after data showed that U.S. employers added significantly more jobs in January than economists expected.
However, Fritz noted, wheat and corn had underlying support from uncertainty about grain supplies from the Black Sea region as the first anniversary of Russia’s Feb. 24 invasion of its neighbor Ukraine approaches, potentially escalating tensions there. (Reporting by Julie Ingwersen; additional reporting by Gus Trompiz in Paris and Matthew Chye in Singapore; editing by Elaine Hardcastle, Mark Potter and Jonathan Oatis)