Soybean futures gave back overnight gains to open little changed as investors who’d been long the market, or bet on higher prices, liquidated positions after prices jumped more than 75 cents in three days.
Futures rose as much as 22 cents overnight before falling back as excessive rain in Argentina threatens production and exports in the South American country. Brazil’s crop also is under duress from extremely dry weather, while exports are being threatened by political strife as the country’s lawmakers initiated impeachment proceedings against President Dilma Rousseff. Still, global inventories and production of soybeans are forecast to jump to a record this year, according to the U.S. Department of Agriculture, and despite the country’s weather woes, Argentina’s prices are still lower than those in the states, analysts said.
“The trade is becoming increasingly concerned about the South American market which is growing increasingly tight,” Tomm Pfitzenmaier, the president of Summit Commodity Brokerage in Des Moines. said in a note to clients on Thursday. “The trade is not paying much attention to what is going to happen this summer in terms of exports, but Argentina is now offering corn for sale at prices under the US for May on out and the Brazilians are offering corn for August on out.”
Soybean futures for July delivery fell 3 1/4 cents to $10.16 a bushel in early trading on the Chicago Board of Trade. Prices had jumped 20 cents and 34 cents on Tuesday and Wednesday, respectively, and were up another 22 cents overnight before falling back, leaving some investors and hedgers to wonder if the 76-cent increase in three sessions was sustainable. Soymeal futures declined $1.30 to $320.20 per short ton, and soy oil declined 0.11 cent to 34.82 cents a pound.
Corn prices plunged 6 cents to $3.93 3/4 as the selloff in beans spilled over into the grains.
(Source – http://www.agriculture.com/content/soybeans-grains-give-up-gains-as-speculative-investors-liquidate-positions)