CHICAGO — U.S. wheat futures dropped to a 2-1/2-month low on Thursday after the United Nations announced an agreement to extend a grain corridor for exports from war-torn Ukraine.
Soybean futures fell on worries about demand as top global buyer China struggles with COVID-19 lockdowns. But corn turned higher as strong weekly U.S. export sales data offset early pressure from news of the Black Sea grain export deal.
Chicago Board of Trade December wheat settled down 10-3/4 cents at $8.06-3/4 per bushel after dipping to $7.93-3/4, the contract’s lowest since Sept. 1.
CBOT January soybeans ended down 12-1/4 cents at $14.17 per bushel while December corn settled up 2-1/4 cents at $6.67-1/2 a bushel.
The United Nations Secretary General said he welcomed an agreement by all parties to extend the grain deal, which has allowed some 10 million tonnes of grain to be shipped from Ukrainian ports since August.
“The Black Sea corridor is the dominant news item, especially for the wheat,” said Jack Scoville, market analyst with the Price Futures Group in Chicago.
News of the deal also pressured corn in early moves, given that Ukraine is a major global supplier of corn as well as wheat. But CBOT corn futures pared losses and turned higher after the U.S. Department of Agriculture reported U.S. corn export sales in the week to Nov. 10 at more than 1.1 million tonnes, near the high end of trade expectations.
Soybeans followed as U.S. crude futures slid more than $3 a barrel on rising numbers of COVID-19 cases in China that could impact demand for commodities. China is the world’s largest buyer of soybeans as well as crude oil.
The bean market was also pressured by weakness in soyoil futures, which sometimes track trends in crude oil given soyoil’s role as the main U.S. feedstock for biodiesel fuel.
The China jitters, coupled with forecasts for beneficial rains in some soy areas of Brazil, offset support from larger-than-expected weekly U.S. soybean exports totalling more than 3 million tonnes.
“The bean sales were really good, but the beans are being affected by weather in South America and worries about Chinese demand moving forward,” Scoville said.
In other news, the International Grains Council trimmed its forecast for 2022/23 global wheat production by one million tonnes, to 791 million tonnes, and maintained its 2022/23 world corn crop outlook at 1.166 billion tonnes. (Reporting by Julie Ingwersen in Chicago; Additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore; Editing by Vinay Dwivedi and Grant McCool)