Bearish Mood Ahead for Grain, Oilseeds; Softs Remain Volatile

A roundup of key agricultural commodity markets for the week of July 22-26 by Dow Jones Newswires in Barcelona.

By Giulia Petroni

GRAINS & OILSEEDS:

The macroeconomic environment looks bearish as the Chinese yuan and Brazilian real--two key currencies for agricultural products--are both weakened against the U.S. dollar, according to market watchers.

Weather and demand trends though seem more supportive this week, squeezing massive fund shorts in corn and soybeans markets. Funds have been selling due to heavy rains, soft demand, and bearish summer seasonals, Peak Trading Research said in a note to clients.

Meanwhile, "August is another broadly bearish month for grain and oilseed markets as traders gain more confidence around final U.S. production prospects," the firm said. "The bearish price patterns for Kansas wheat, Chicago wheat, and soybeans illustrate the downward trend that we see in August and September across most U.S. grain and oilseed markets."

Chicago wheat futures were 0.7% lower at $5.44 a bushel on Tuesday, while corn was up 0.9% at $4.19 a bushel. Soybeans prices rose 0.6% to $10.75 a bushel.

SOFT COMMODITIES:

The past month has seen contrasting movements in coffee and cocoa futures, according to BMI analysts. Despite cocoa's monthly downturn, futures are up more than 98% on year on Tuesday, driven by weather concerns in West Africa. Nonetheless, gains are capped by prospects of more beneficial conditions in Cameroon and Nigeria, market watchers said.

Meanwhile, coffee futures are up roughly 7% on the month and more than 28% on year, with sentiment boosted by a challenging supply outlook that includes falling exports from Vietnam and adverse weather conditions in Brazil, BMI said in a note.

Cocoa traded 1% lower at $8,309 a metric ton, while coffee fell 0.6% to $2.42 a pound on Tuesday. Sugar was down 0.2% to $0.18 a pound.

Write to Giulia Petroni at [e-mail]

(END) Dow Jones Newswires

07-23-24 0905ET