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U.S. soybean futures fall to 1-week low on improving crop prospects

Published 07/07/2015, 06:46 AM
Soybean futures come under pressure amid improving crop prospects
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Investing.com - U.S. soybean futures extended losses from the previous session on Tuesday to hit a one-week low amid improving crop prospects in the U.S. Midwest.

On the Chicago Mercantile Exchange, US soybeans for August delivery fell to an intraday low of $10.1363 a bushel, the weakest level since June 30, before trading at $10.1563 during U.S. morning hours, down 6.38 cents, or 0.62%. A day earlier, prices of the oilseed lost 16.0 cents, or 1.54%, to close at $10.2220.

According to the U.S. Department of Agriculture, nearly 63% of the soybean crop was in good to excellent condition as of July 3, unchanged from a week earlier and below the 72% recorded in the year-earlier period.

Soybean emergence was 93% complete, improving from 89% a week earlier, while 21% of the crop bloomed, up from 8% in the preceding week.

Prices of the oilseed rallied to a seven-month high of $10.5460 on July 1 after the USDA said that U.S. farmers will plant 85.139 million acres of soybeans this year, compared with 83.701 million last year.

According to the USDA, domestic stockpiles at the beginning of June totaled 625 million bushels, up from 405 million a year earlier.

While the planting and stockpile estimates were both higher compared to a year earlier, the results came in below market expectations due to heavy demand for the oilseed.

Meanwhile, US wheat for September delivery shed 5.38 cents, or 0.91%, to trade at $5.8762 a bushel early on Tuesday. Wheat slumped to a one-week low of $5.7220 on Monday before turning higher to end at $5.9540, up 5.0 cents, or 0.85%.

The USDA said Monday that nearly 55% of the U.S. winter-wheat crop was harvested as of July 5, up from 38% a week earlier. Approximately 55% of the crop was harvested in the same week last year, while the five-year average for this time of year is 59%.

About 40% of the U.S. winter-wheat crop was rated good to excellent as of last week, down from 41% in the preceding week. The agency also said that nearly 70% of the spring-wheat crop was in good to excellent condition, compared to 72% a week earlier.

Last week, the USDA forecast domestic wheat reserves as of June 1 at 753 million bushels, up from 590 million on the same date a year earlier. According to the agency, farmers in the U.S. will plant 56.079 million acres of wheat this year, compared with 56.822 million in 2014.

Elsewhere on the Chicago Board of Trade, US corn for September delivery inched up 0.93 cents, or 0.22%, to trade at $4.2312 a bushel in early trade on Tuesday.

Approximately 69% of the corn crop was in good to excellent condition as of June 21, according to the USDA, up from 68% in the preceding week. The five-year average is 75% for this time of year.

Corn hit a seven-month peak of $4.3060 on July 2 after the USDA estimated that U.S. farmers had planted 88.897 million acres of corn this year, down from 90.597 million last year.

A separate USDA report showed that domestic corn inventories totaled 4.447 billion bushels on June 1, compared with 3.852 billion bushels on that date last year.

Corn is the biggest U.S. crop, followed by soybeans, government figures show. Wheat was fourth, behind hay.

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