CHICAGO (Xinhua) – Chicago Board of Trade (CBOT) agricultural futures closed more than two per cent higher across the board in the week ending on December 7, amid better-than-expected export sales and hopes that China and the United States will take measures to ease trade tensions.
China and the United States agreed on the sidelines of the G20 summit in Argentina to take measures to ease bilateral trade tensions.
The positive development boosted CBOT soybean prices by double digits as traders came back to the agricultural market last Monday.
“This is the first positive news we’ve seen after months of downturned prices and halted shipments,” said the president of American Soybean Association John Heisdorffer.
China is the world’s top soybean buyer, but amid the escalation of trade disputes, China cut down its soybean imports from the United States.
“We want to begin repairing damage done to our trade relations with China, which has been essential to successful soybean exports for years,” added Heisdorffer, a soybean grower from Iowa state, in a statement released last Monday morning.
Better-than-expected export sales gave further support to the oil seed futures as the US Department of Agriculture (USDA) released on Friday its latest export sales report for the period of November 23-29.
The USDA announced a total of 890,900 metric tons of soybean sales in this period, up 42 per cent from the previous week and 87 per cent from the prior four-week average.
Most of the increases were reported for Argentina, Indonesia, Spain and the Netherlands.
Official data also showed an 89 per cent weekly increase in wheat exports. The weekly wheat sales of 711,800 metric tonnes were also 58 per cent higher from the prior four-week average.
Although Egypt’s state importer GASC reportedly failed to open letters of credit on 945,000 metric tons of wheat, impacting deliveries from late November into late December and even January 2019, the bearish news triggered no significant corrections in CBOT wheat futures.
The US corn export sales were down seven per cent from the previous week to 1,177,500 metric tonnes, according to the USDA report.
However, the sales were still up 26 per cent from the prior four-week average.
Also thanks to spillover support from surging soybean futures, CBOT corn prices ended this week with a rise of over two per cent, similar to last week.
The most active contract for March 2019 corn was up 7.75 cents weekly, or 2.05 per cent, to 3.855 dollars per bushel.
March wheat delivery went up 15.5 cents, or 3.06 per cent, to 5.3125 dollars per bushel. January soybeans rose 22 cents, or 2.46 per cent, to 9.1675 dollars per bushel.