May 18, 2013
Bargain buyers grab grains after selloff
US soybeans rose nearly 2 percent on Wednesday after their biggest two-day selloff in seven weeks, and corn and wheat also climbed on buying interest at lower prices.
Soybeans had fallen sharply this week on expectations crop yields across the drought-stricken US Midwest will exceed forecasts as harvesting achieves a record pace.
But there is still doubt whether even a larger-than-expected US soybean crop will be enough to meet high world demand up to the new South American soy harvests in early 2013, causing a sharp drawdown of inventories.
Farmers have also slowed selling on the cash market after the price plunge, keeping commercial hedge pressure light on the futures, said Dale Durchholz, senior market analyst at AgriVisor LLC.
The market has also seen some end-user buying interest from Asia, and is bouncing in response to the sharp pull-back earlier in the week, he said.
Grains garnered further support after Bank of Japan became the latest leading central bank to take aggressive measures to stimulate its economy, said Mike Zuzolo, president of Global Commodity Analytics.
"I think that came away with a risk-on attitude," he said.
Chicago Board of Trade November soybeans rose 1.8 percent or 29-1/2 cents to $16.69-1/2 a bushel, having closed on Tuesday down 1.7 percent for a loss of nearly 6 percent over two days.
Chicago December wheat rose 2.1 percent or 18 cents to $8.81-1/2 a bushel, recouping the previous session's 1.7 percent fall, while December corn rose 2.2 percent or 16-1/2 cents to $7.56-1/2 a bushel, having closed Tuesday down 1 percent.