Investing.com – Soybean futures declined on Wednesday, as prospects of near-term rainfall in drought-stricken areas in Argentina prompted investors to readjust positions ahead of Thursday's key monthly report on U.S. and global soybean supplies.
On the Chicago Mercantile Exchange, soybeans futures for March delivery traded at USD12.1838 a bushel during European morning trade, dropping 1.07%.
It earlier fell by as much as 1.15% to trade at a two-day low of USD12.1562 a bushel.
Soybean prices have rallied nearly 10% since mid-December as dry and hot weather conditions damaged crops in Argentina and Brazil, the world’s second and third largest soy exporters.
Prices came under pressure after agricultural meteorologists said that they expected rainfall across major soybean-growing areas in the Pampas region in Argentina this week, however concerns remained that the nation’s soy crops have already suffered irreversible damage.
The heat of the Southern Hemisphere's summer has been compounded by La Nina, a phenomenon in which tropical waters in the Pacific Ocean turn unusually cold. The La Nina weather pattern typically brings heavier rainfall in Asia and drier weather in South America.
However, industry weather group Telvent DTN said Tuesday that the ongoing La Nina weather event had potentially “topped out” after peaking in December.
Australia’s Bureau of Meteorology offered a similar outlook on Monday, saying that the ongoing La Nina weather event was “at or nearing its peak”.
A diminishing La Nina may gradually allow rainfall to return to normal, replenishing soil moisture and aiding crop development.
Traders have been focusing on weather conditions and crop prospects in Southern Hemisphere countries in recent weeks, as most Northern Hemisphere grain crops have been harvested by now.
Meanwhile, markets were looking forward to Thursday’s closely-watched U.S. Department of Agriculture’s World Supply and Demand Report for revised forecasts of South American crop production.
Wall Street investment bank Morgan Stanley said in a report Tuesday that,“We expect downward revisions to soybean production estimates in Brazil and Argentina of up to 2 million tons each, owing to developing drought conditions.”
However, the report added that the USDA may wait until later in the growing season to make these cuts.
Elsewhere on the Chicago Mercantile Exchange, wheat for March delivery declined 0.45% to trade at USD6.3638 a bushel, while corn for March delivery slipped 0.4% to trade at USD6.4838 a bushel.
On the Chicago Mercantile Exchange, soybeans futures for March delivery traded at USD12.1838 a bushel during European morning trade, dropping 1.07%.
It earlier fell by as much as 1.15% to trade at a two-day low of USD12.1562 a bushel.
Soybean prices have rallied nearly 10% since mid-December as dry and hot weather conditions damaged crops in Argentina and Brazil, the world’s second and third largest soy exporters.
Prices came under pressure after agricultural meteorologists said that they expected rainfall across major soybean-growing areas in the Pampas region in Argentina this week, however concerns remained that the nation’s soy crops have already suffered irreversible damage.
The heat of the Southern Hemisphere's summer has been compounded by La Nina, a phenomenon in which tropical waters in the Pacific Ocean turn unusually cold. The La Nina weather pattern typically brings heavier rainfall in Asia and drier weather in South America.
However, industry weather group Telvent DTN said Tuesday that the ongoing La Nina weather event had potentially “topped out” after peaking in December.
Australia’s Bureau of Meteorology offered a similar outlook on Monday, saying that the ongoing La Nina weather event was “at or nearing its peak”.
A diminishing La Nina may gradually allow rainfall to return to normal, replenishing soil moisture and aiding crop development.
Traders have been focusing on weather conditions and crop prospects in Southern Hemisphere countries in recent weeks, as most Northern Hemisphere grain crops have been harvested by now.
Meanwhile, markets were looking forward to Thursday’s closely-watched U.S. Department of Agriculture’s World Supply and Demand Report for revised forecasts of South American crop production.
Wall Street investment bank Morgan Stanley said in a report Tuesday that,“We expect downward revisions to soybean production estimates in Brazil and Argentina of up to 2 million tons each, owing to developing drought conditions.”
However, the report added that the USDA may wait until later in the growing season to make these cuts.
Elsewhere on the Chicago Mercantile Exchange, wheat for March delivery declined 0.45% to trade at USD6.3638 a bushel, while corn for March delivery slipped 0.4% to trade at USD6.4838 a bushel.