BEIJING – Chicago soybean futures fell on Tuesday as traders weighed US-China trade developments, and concerns that President Donald Trump’s proposed EPA funding cuts could reduce biofuel demand.
The most-active soybean contract on the Chicago Board of Trade (CBOT) slipped 0.29 percent to $10.43 a bushel.
Markets are watching for signs of a thaw in US-China trade tensions, with China’s commerce ministry saying on Friday that it is “evaluating” a US offer to hold talks on tariffs imposed during the Trump administration.
Trump’s proposed Environmental Protection Agency (EPA) funding cuts have unsettled traders, who worry it could reduce demand for biofuels made from soy and other oils, weighing on soybean prices.
Traders are also positioning ahead of next Monday’s United States Department of Agriculture supply and demand report.
“Most expectations are for ‘more of the same’ in the sense that there will be about the same amount of wheat around, slightly more corn and slightly less beans – this has led to some initial pressure on the market” said Ole Houe, director of advisory services at IKON Commodities in Sydney.
Houe added that signs are emerging that US grain is becoming affordable enough to spark demand, and he anticipates the markets will stabilize at current levels.
