September 5, 2019 / 8:19 PM / 3 months ago

GRAINS-Soybeans sag on U.S. demand worries; wheat ends higher, corn firm

 (Updates with closing U.S. prices)
    By Julie Ingwersen
    CHICAGO, Sept 5 (Reuters) - U.S. soybean futures fell more
than 1% on Thursday on concerns about burdensome supplies and
weak export demand as the U.S. trade war with China continues,
analysts said.
    Wheat futures rose on short-covering and worries about
drought in Australia, and corn edged higher, despite bearish
weekly U.S. ethanol statistics.
    Chicago Board of Trade November soybeans settled down
14 cents at $8.61-1/2 per bushel after dipping to $8.58-1/4, a
one-week low.
    CBOT December wheat ended up 5-1/2 cents at $4.66-1/4
a bushel and December corn finished 1/4 cent higher at
$3.58-3/4 a bushel.
    Soybeans firmed in early moves on news that China and the
United States agreed to hold high-level talks in early October,
raising hopes for a thaw in their trade dispute. China is the
world's top soy importer.
    But CBOT soy futures turned down as brokers shifted their
focus to ample U.S. supplies and prospects for large harvests in
South America, which has ramped up exports to China during the
trade war.
    Commodity brokerage INTL FCStone late on Wednesday raised
its forecast of the U.S. 2019 soybean yield to 48.3 bushels per
acre, from its Aug. 1 figure of 47.2. The firm put U.S. soybean
production at 3.661 billion bushels, down from 3.743 billion
previously, reflecting a smaller harvested acreage figure from
last month.
    On Thursday, INTL FCStone projected Brazil's 2019/20 soybean
crop at 121.41 million tonnes, up from 115.07 million in
2018/19. The U.S. Department of Agriculture has projected
Brazil's 2019/20 crop at 123 million tonnes.

    "Without an agreement with China to buy our beans, they
(China) are free to buy South American soybeans. And that is
going to hurt our export demand," said Brian Hoops, president of
broker Midwest Market Solutions.
    Separately, China's customs agency said it had allowed
imports of soymeal and other oilseed products from Russia, which
so far has been a minor soybean producer.
    "We continue to lose market share. And this trade deal
between us and China is nowhere close to happening," said Tom
Fritz, a partner with EFG Group in Chicago.
    CBOT wheat futures climbed, rallying from three-month lows
set this week, while K.C. hard red winter wheat futures
and Minneapolis Grain Exchange spring wheat futures
recovered from 14- and 10-year lows, respectively.
    Traders cited wheat prospects in Australia, which is
struggling with a third straight year of drought.
    "There are concerns about the crop in Australia being hurt,
and that could show up in the USDA report next week," said
Hoops, referring to the USDA's monthly supply/demand report due
on Sept. 12.
    Corn futures inched higher as the strength in wheat helped
lift corn from life-of-contract lows set a day earlier.
    Traders shrugged off bearish weekly ethanol data. The U.S.
Energy Information Administration said weekly U.S. output of the
corn-based biofuel fell to 1.01 million barrels per day, the
lowest since April, while stocks rose to 23.8 million barrels.
    CBOT settlement prices: 
                                  Net     Pct  Volume
                         Last  change  change        
 CBOT wheat     WZ9    466.25    5.50     1.2   44185
 CBOT corn      CZ9    358.75    0.25     0.1  129413
 CBOT soybeans  SX9    861.50  -14.00    -1.6  108785
 CBOT soymeal   SMZ9   294.50   -4.00    -1.3   46400
 CBOT soyoil    BOZ9    28.64   -0.35    -1.2   71389
    NOTE: CBOT December wheat and corn and November soybeans
shown in cents per bushel, December soymeal in dollars per short
ton and December soyoil in cents per lb.

 (Reporting by Julie Ingwersen; Additional reporting by Naveen
Thukral in Singapore and Sybille de La Hamaide in Paris; Editing
by Edmund Blair, Steve Orlofsky and Peter Cooney)
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