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Chicago grains ease as weather, Fed decision in focus

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PARIS/SINGAPORE — Chicago soybean, corn and wheat

futures drifted lower on Wednesday as participants assessed weather outlook for

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South American crops while awaiting broader direction from a U.S. Federal

Reserve interest rate decision.

Demand remained in focus after a series of U.S. soybean export sales to

China and with a wheat import tender being held by Algeria.

The most-active soybean contract on the Chicago Board of Trade (CBOT)

was down 0.6% at $14.71-1/4 a bushel by 1120 GMT, after gaining 1.6% on

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Tuesday when it approached a three-month peak.

“Today it is the Fed that will be closely followed,” consultancy Agritel

said in a note.

“Soybeans were up in Chicago yesterday amid good export activity. However,

any rise could be limited by record production prospects in Brazil and

beneficial rains in Argentina in recent days.”

Private exporters reported the sale of 140,000 tonnes of U.S. soybeans to

unknown destinations in the 2023/24 marketing year, the U.S. Department of

Agriculture said on Tuesday.

But traders are weighing whether a recent upturn in demand from China may be

curbed when Brazil’s expected bumper harvest arrives on the market from January.

Drought in Argentina was still a risk for international corn and soybean

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supply, with the benefit of showers last weekend potentially limited by a hot

week ahead, analysts said.

CBOT wheat was down 1.3% at $7.41-1/4 a bushel and corn was off

0.7% at $6.48-3/4 a bushel.

The resumption of sailings on Tuesday from Odesa, after the Ukrainian port

had suspended operations on Sunday after Russian strikes on energy supplies,

tempered worries about renewed war disruption to Black Sea trade.

Wheat traders were also watching for the outcome of Algeria’s tender on

Wednesday to see if war risks and the onset of winter weather would disadvantage

offers of Russian and Ukrainian wheat.

Grains like wider financial markets were bracing for the Federal Reserve’s

policy decision later on Wednesday, with investors waiting to see if the central

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bank will slow its pace of interest rate hikes to curb inflation.

Prices at 1120 GMT

Last Change Pct End Ytd Pct

Move 2021 Move

CBOT wheat 741.25 -9.50 -1.27 770.75 -3.83

CBOT corn 648.75 -4.75 -0.73 593.25 9.36

CBOT soy 1471.25 -8.50 -0.57 1339.25 9.86

Paris wheat 301.25 -4.25 -1.39 276.75 8.85

Paris maize 284.00 -3.50 -1.22 226.00 25.66

Paris rape 556.50 -6.75 -1.20 754.00 -26.19

WTI crude oil 76.04 0.65 0.86 75.21 1.10

Euro/dlr 1.07 0.00 0.19 1.1368 -6.32

Most active contracts – Wheat, corn and soy US cents/bushel,

Paris futures in euros per tonne

(Reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore; Editing by

Subhranshu Sahu and Uttaresh.V and David Evans)

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