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Grain futures regain strength on bargain buying; Soybeans, corn rise

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Investing.com - U.S. grain futures regained strength on Monday, with soybean and corn prices bouncing off multi-month lows as investors returned to the market to seek cheap valuations.

On the Chicago Mercantile Exchange, soybeans futures for May delivery traded at USD13.7450 a bushel, up 0.9% on the day. The May contract rose by as much as 1.1% earlier in the session to hit a daily high of USD13.7812 a bushel.

CBOT soy prices fell to USD13.5462 a bushel on Friday, the weakest level since June 6, as investors sold the oilseed amid worries over the impact of a bird flu outbreak in China, which could reduce feed demand in the world's biggest soy consumer.

China accounts for roughly 60% of world soybean imports and its purchases have a big impact on prices. Soybeans are used as a key ingredient in chicken feed.

Soy prices have been on a downward trend in recent weeks, falling into bear market territory earlier in the month. Prices of the oilseed are down nearly 23% since hitting an all-time high of USD17.9475 a bushel, set in September.

Meanwhile, corn futures for May delivery traded at USD6.3412 a bushel, up 0.7% on the day. The May contract rose by as much as 0.9% earlier in the day to hit a session high of USD6.3538 a bushel.

Corn traders returned to the market to snap up bargains after the grain lost 6.6% last week, the biggest weekly decline in 21 months. CBOT corn prices fell to USD6.2662 a bushel on Friday, the weakest level since June 25.

Corn prices have been in liquidation mode in recent sessions as market players exited bets that prices will rise in response to last week's bearish USDA supply report.

Prices are down nearly 15% since the release of the USDA report on March 28, which showed U.S. corn stockpiles totaled 5.39 billion bushels as of March 1, well above market expectations of 4.99 billion bushels.

Corn prices, like soybeans, entered a bear market slump earlier in the month. Prices of the grain are down almost 24% since hitting an all-time high of USD8.3325 a bushel, set at the height of the U.S. drought in August 2012.

Elsewhere, wheat for May delivery traded at USD7.0525 a bushel, up 0.85% on the day. The May contract rose by as much as 1.3% earlier to hit a daily high of USD7.0862 a bushel, the strongest level since March 28.

Investors continued to buy the grain amid concerns that adverse weather conditions in major wheat-growing states across the Great Plains-region will hurt the U.S. winter crop.

Wheat traders have been closely monitoring weather and crop conditions in the area, where prolonged dryness threatens dormant winter wheat crops.

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

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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