Traders focused on demand for crops after the US Department of Agriculture updated its national production estimates in a monthly report released on Monday.
“While we answered a lot of questions on the supply side, we now have a lot of questions on the demand side,” said Ted Seyfried, chief market strategist at Zaner Ag.
In Argentina, the world’s largest exporter of soybean oil and flour and the third largest exporter of unprocessed oilseeds, Producers increased their sales after the government implemented a more favorable exchange rate for crop exports. Until last month, they were abstaining from eating more soy than usual due to the uncertain economic environment in Argentina.
“Competition from South American supplies continues to pressure US soybean exports,” he said. Zhongzhou Futures analysts in China said.
Trading was choppy as Wall Street’s major indexes reached two-month lows and investors slid between tight US grain stocks and uncertain demand.
“We’re trying to reconcile the idea of tighter-than-expected budgets, especially in soybeans,” Sefried said. “We’re kind of stuck in the middle.”
Traders will be watching the pace of US corn and soybean harvests, which generally benefit from hot, dry weather. In the southern delta region, the rains weren’t enough to hamper the harvest, according to the Commodity Weather Group.