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Soybean Struggles for Direction Amid La Nina Concerns, USDA Ratings

Summary:
Soybean futures are struggling for direction on Tuesday as investors weigh La Nina concerns and the US government’s ratings for domestic crop conditions. Soybean prices have been testing their best levels in 28 months, and some analysts anticipate the agricultural commodity to climb to a six-year high. With a US dollar on the decline and foreign demand increasing, the crop could again. November soybean futures dipped %excerpt%.0075, or 0.07%, to .2175 per bushel at 16:30 GMT on Tuesday on the Chicago Board of Trade (CBoT). Soybean prices have been on a tear in recent months, rallying 17% since the end of June. Year-to-date, the crop is up 9%. The US Department of Agriculture (USDA) published its weekly crop progress report on Monday. It noted that 63% of the soybean crop was rated

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Soybean futures are struggling for direction on Tuesday as investors weigh La Nina concerns and the US government’s ratings for domestic crop conditions. Soybean prices have been testing their best levels in 28 months, and some analysts anticipate the agricultural commodity to climb to a six-year high. With a US dollar on the decline and foreign demand increasing, the crop could $15 again.

November soybean futures dipped $0.0075, or 0.07%, to $10.2175 per bushel at 16:30 GMT on Tuesday on the Chicago Board of Trade (CBoT). Soybean prices have been on a tear in recent months, rallying 17% since the end of June. Year-to-date, the crop is up 9%.

The US Department of Agriculture (USDA) published its weekly crop progress report on Monday. It noted that 63% of the soybean crop was rated in good-to-excellent condition, unchanged from the previous week. It also rated 61% of the corn crop in good-to-excellent condition, which is unchanged from last week.

Foreign demand continues to be on the rise, primarily because of China. According to Reuters, Chinese government-owned importers acquired at least eight bulk shipments of American soybeans. The newswire reported that Beijing bought about 480,000 tons. The world’s second-largest economy has been ordering millions of tons of soybeans in recent months as part of efforts to adhere to the provisions inside the phase one trade agreement. China had been falling short of its obligations in the first few months of 2020, but it has since increased its acquisitions.

Early estimates suggest China’s imports could top 100 million metric tons for the 2020–2021 marketing season as the country takes advantage of a weaker US dollar.

The other aspect of soybean’s ascent might be La Nina. According to the National Oceanic and Atmospheric Administration (NOAA), a La Nina climate pattern is forming in the Pacific Ocean, and it is anticipated to continue throughout the winter. Experts are warning this could disrupt soybean production and tighten supplies.

Some projections suggest soybean prices could top $13 over the next 12 months.

In other agricultural commodities, October corn futures shed $0.0075, or 0.2%, to $3.69 per pound. October wheat futures added $0.045, or 0.81%, to $5.5925 a bushel. November coffee futures tumbled $0.014, or 1.25%, to $1.106 per pound.


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Andrew Moran
I am a full-time professional writer. Prior to my self-employment, I worked as a reporter for Digital Journal covering the politics beat and The Toronto Times reporting on the city’s entertainment scene. I currently write mostly about business, marketing and finance

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