Soybeans fell again this Wednesday, for the third consecutive day, and was close to piercing the floor of $ 500 per ton in the Chicago market, after the 6 and a half year highs registered last week. The March 21 contract closed at 503.20 US $ / ton, with a loss of 5.97 US $ / ton compared to the previous day. In the case of soybeans, it falls. However, cereals suffered proportionally more. The March21 corn lost 1.57 US $ / t to close at 205.50 US $ / t and the wheat fell 1.65 US $ / t and ended at 245.36 US $ / t.
“The day came when the financial funds decided to exit their purchased soybean positions,” said agribusiness consultant Pablo Adreani. And he warned that among this type of global investors, “some are buying US $ 130 / t below the current market price. Therefore, any drop in prices continues to allow them to make a profit ”.
Lorena D’Angelo, market analyst at AZ Group, stressed to Clarín that “the Chicago market is registering a profit taking from the strong increases that were registered in recent months. Hedge funds are coming out of the net bought position they recently built ”.
And Esteban Moscariello, commercial executive at Díaz Riganti Cereales, also described as the cause of the decline to “the taking of profits and the sale of financial funds that operate with commodities, which began at the end of last week.”
In the same sense, the consultant Hernán Fernández Martínez evaluated the situation: “The markets tend to take breaks in the rises,” he described. And he was convinced that we are facing one of those moments “because the context of supply and demand did not change. I don’t see that you have to despair about this fall ”. So, sometimes these pauses can be taken as opportunities: they serve to buy tools, such as calls, that allow you to capture potential subsequent raises ”.
D’Angelo remarked that “there were no fundamental changes. Only it rained in the producing regions of South America; particularly, soybean crops in Brazil and Argentina received favorable rains that improve their situation ”.
In the market criteria that Moscariello surveyed, the loss of strength of the oilseed is also attributed to the improvement in rainfall patterns in much of South America ”.
Eugenio Irazuegui, from the Zeni broker, agrees: “The soy market took note of the change in the rainfall pattern in broad sectors of Argentina and Brazil, both important players in world trade. From 01/15 to 01/17 a generous flow of rain was registered in the center of our country, allowing to partially replace the moisture in the soil. Conditions also improved in southern Brazil, more precisely in Paraná, Santa Catarina and Rio Grande do Sul. This reduces concerns regarding the development of crops and the volume of harvest that they will be able to contribute in the coming months ”.