Soybeans, Corn, and Wheat on the Defensive Amid Planting Progress
Agricultural commodities started the week with losses, but as the day continues, soybeans, corn, and wheat are recovering ground.
Most of the decline may be attributed to improvements in the planting progress amid better weather in the United States, and reports that soybeans imports in China have fallen on Trade war and pig disease.
Agricultural trading report
Soybeans recovered early losses, and it is now trading positive on the first day of the week. It would be its first daily gain in the last four sessions.
The same story with corn, the grain recovered from the 4.030 area, and it is posting gains on the day. However, the advance is limited.
Wheat bounced at 4.900 before recovering the 5.000 area on Monday. The 200-day moving average supports the unit at 4.840.
Sugar was rejected by the 0.1240 rea again on Monday after testing it several times last week. It is now trading down at 0.1225.
Futures of coffee is down again on Monday as the 200-day moving average is acting as resistance at 102.35. Previously, the unit jumped to 103.35, but it couldn’t sustain the move.
Weather improves in the United States
Better weather conditions are expected to improve in the next day according to Alex Sosnowski, AccuWeather senior meteorologist. “More dry weather is in store for the northeastern United States this week, but it will be sandwiched in between two rounds of rain and thunderstorms.”
Besides, Renee Duff, also an AccuWeather meteorologist, affirmed in a recent piece of news published by his company, “while showers and locally severe thunderstorms will cross the central United States on occasion this week, the wet weather will not be as persistent as in recent weeks.”
Duff affirms that farmers will be able to get back to the fields to continue their planting. “The less frequent rainy periods will aid communities continuing to clean up from devastating flooding and farmers who have been kept from working in flooded fields.”
Long story short, the weather is improving and the conditions for planting are better than previous weeks. In this framework, soybeans, corn, and wheat prices are under pressure.
China imported fewer soybeans in May
Imports of soybeans fell 24% in China in May from the same month in the last year, according to a report from the General Administration of Customs quoted by Reuters. They signaled ongoing Sino-US trade war and African swine fever as reasons.
China imported 7.36 million tonnes of soybeans in May, down 9.69 million tonnes in May 2018.
Remember that China added a 25% tariff to US soybeans imports last July, as a countermeasure from the tariffs imposed by the White House and the government of Donald Trump.
Soybeans bounces and post gains on the day
Prices of Soybeans are trading in a rollercoaster on Monday as the bushel fell to trade as low as 8.410, its lowest level since May 28, earlier in the day. Then, it bounced back and recovered to trade above the 50-day moving average at 8.520.
Currently, the unit is trading 0.80% positive on the day as it is extending its recovery. However, the 8.600 area is containing the upside for the bushel.
This article was originally posted on FX Empire
