GRAINS-US closes soybeans as Argentina drought concerns persist

By Christopher Walljasper

CHICAGO, Jan. 30 (Reuters) – Chicago soybeans climbed on Monday, buoyed by fears that drought-damaged crops in Argentina will face drier weather.

Wheat slightly higher after hitting four-week highs earlier in the session on fears that a cold spell in the US grain belts could damage crops, while the potential escalation of the Russian-Ukrainian war also supported prices.

Chicago Board of Trade’s most active soybean rose Sv1 25-3/4 cents to $15.35-1/4 a bushel, after hitting $15.38, its highest since Jan. 18.

Wheat Wv1 added 2 1/2 cents to settle at $7.52 1/2 a bushel, after hitting $7.62 1/2, its highest since Jan. 4.

Corn CV1 gained 3/4 cent to $6.83-3/4 a bushel.

“Beans are watching the weather closely in southern Brazil and Argentina, which are once again drying out,” said Jack Scoville, market analyst at The Price Futures Group.

Drought conditions across Argentina continue to erode soybean yields in Argentina, as forecasts dry up again, despite recent rains which helped the growing conditions.

U.S. soybean futures remain capped at Brazil harvested 5% of its planned 152.9 million tonnes of oilseeds, according to agribusiness consultancy AgRural.

Soybeans also found short-lived support early in the session on optimism that China might increase buying after the Lunar New Year holiday.

“I think China was expected to come through the door, and nothing happened today with exports,” said Dan Smith, chief risk officer at Top Third Ag Marketing.

Weekly export inspections of 1.855 million tons of soy during the week ended January 26, additional support, approaching the high end of analysts’ expectations ranging from 900,000 to 1.9 million tons.

A cold spell in the US Midwest gave wheat futures a boost early in the session, although prices fell as forecasts moderated on Monday, reducing the risk of damage to wheat crops of winter.

“It seems to be a milder event than what we experienced in December,” Scoville said. “Whenever it’s as cold as it is, there will be spec buying.”

Wheat was also buoyed by fears that the war would reduce Ukraine’s production harvestsand that Russia crop would also fall short of expectations.

Corn followed wheat, but was supported by the announcement of export sales of 112,000 metric tons of corn for delivery to Japan in the 2022/2023 marketing year, the U.S. Department of Agriculture said.

Weekly maize export inspections of 527,932 tonnes were lower than analysts’ forecast, while 445,433 tonnes of wheat inspected were near the upper end of analysts’ estimates.

(Reporting by Christopher Walljasper in Chicago; additional reporting by Michael Hogan in Hamburg and Enrico Dela Cruz in Manila, Editing by Deepa Babington and Nick Zieminski)

((Christopher.Walljasper@thomsonreuters.com; 1 630 269 3072; Reuters Messaging: christopher.walljasper.thomsonreuters.com@reuters.net))

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