CHICAGO- Chicago Board of Trade soybean futures rallied to their highest since June 2018 as traders projected an increase in the US Department of Agriculture forecast for exports with a further cut in domestic production.
Corn futures reached a six-month high, while wheat futures fell to a two-week low.
The USDA, in a monthly report, said US corn and soybean production will be smaller than previously expected because of unfavorable weather last month. Traders expect inventory estimates may tighten due to even lower harvest forecasts and higher exports.
The USDA left its estimate for soybean exports unchanged from August, despite robust demand from China. The agency, through a daily reporting system, has announced sales to the world’s top soybean importer for six consecutive trading sessions.
China, seeking to combat food security risks, has also been a big buyer of US corn. The USDA kept its estimate for China’s corn imports unchanged from last month.
“The trade believes that the yields are going to continue to fall,” said Don Roose, president of Iowa-based broker US Commodities. “And you still have a buyer underneath the market: China.” —Reuters