GRAINS-Soybeans, corn hit 7-month highs on South American crop worry


By Gavin Maguire and Michael Hogan

SINGAPORE/HAMBURG, Jan 31 (Reuters) - Chicago soybeans and corn hit seven-month highs on Monday on expectations drought-stressed South American harvests could shift demand to the United States.

Wheat was pushed higher by the Russia/Ukraine crisis and strong crude oil prices supported grains and oilseeds generally.

Chicago Board of trade most-active soybeans Sv1 hit $14.96-3/4 a bushel, the highest since June 2021, and were up 1.1% at 14.86-1/2 at 1158 GMT.

Corn Cv1 hit $6.42-1/2 a bushel, also the highest since June 2021, and was last up 0.5% at $6.39-1/2. Wheat Wv1 rose 0.7% to $7.91-3/4 a bushel.

Concerns about reduced South American supplies after dryness hit harvests have underpinned grain and oilseed market sentiment in recent weeks.

“Soybeans and corn are again being supported today by the continued fear that recent dry weather has damaged South American crops, especially in Brazil and Argentina,” said Matt Ammermann, StoneX commodity risk manager. “With harvesting in South America now starting we are experiencing increased concern that crops could have suffered more from dryness than previously expected.”

“Farmers in Brazil look like being reluctant sellers in this uncertainty. This is again opening up the debate about soybean export demand being switched from South America to the United States at a time of pretty tight U.S. soybean supplies.”

Smaller South American soybean harvests are likely to push major soybean export business to the United States from June, Hamburg-based oilseeds analysts Oil World said last week.

“Wheat continues to be underpinned by political risk from the Russia/Ukraine crisis,” Ammermann said.

“There were signs last week that the situation in the Black Sea could be cooling down, but the crisis news flow continues and it has certainly not been solved yet. This also leads to concern a conflict could disrupt Russian and Ukrainian wheat exports in some way, either by fighting or sanctions.”

Chicago crop prices push higher on South American crop worries, Ukraine tensions

(Reporting by Michael Hogan in Hamburg and Gavin Maguire in Singapore, editing by Barbara Lewis)

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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.

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