Soybeans extend gains as traders weigh Trump reelection chances
CANBERRA, July 23 (Reuters) -Chicago soybean futures extended the climb on Tuesday after a reassessment of Donald Trump's chances of winning the U.S. elections propelled prices to their biggest jump in one year in the previous session.
Soybeans hit four-year lows last week amid ample supply and anticipation that Trump could renew his trade war with top soy importer China, but U.S. President Joe Biden's decision on Sunday to step aside changed the election dynamics, triggering a rush of short-covering.
Corn futures dipped after rallying on Monday while wheat also eased.
FUNDAMENTALS
* The most-active soybean contract on the Chicago Board of Trade (CBOT) Sv1 was up 0.2% at $10.70-3/4 a bushel, as of 0054 GMT, after rising 3.2% on Monday.
* CBOT corn Cv1 slipped 0.3% to $4.13-3/4 a bushel, having risen 2.5% in the previous session, while wheat Wv1 fell 0.3% to $5.46-1/4 a bushel.
* All three contracts are near their lowest levels since 2020 amid plentiful supply. Speculators are betting heavily on lower prices, leaving the markets vulnerable to bouts of short-covering.
* "The fundamental underperformance of agri markets since late May, in our view, partly reflects the trepidation of a return to tariffing, retaliation and distorted trade which would likely be a feature of a Trump 2.0 Presidency," analysts at JPMorgan said.
* U.S. Vice President Kamala Harris has received a flood of endorsements and cash since Biden's exit, reinvigorating the Democrats.
* The U.S. Department of Agriculture on Monday rated 67% of the nation's corn crop in good-to-excellent condition, down one percentage point, and 68% of the soybean crop in good-to-excellent condition, unchanged from last week.
* The ratings for both crops are the highest for this time of year since 2020.
* The winter wheat harvest, however, advanced more slowly than expected and was 76% complete by Sunday, the USDA said.
* Wheat traders are keeping an eye on forecasts for hot, dry weather in Canadian and northern U.S. spring wheat belts and parts of the Black Sea region, as well as poor cropping conditions in France.
* Russian wheat export prices were unchanged last week, shipment volumes are still low and farmers are not in a hurry to sell at current low levels, analysts say.
* Brazilian farmers in the key center-south region had harvested 83% of their second corn crop for the 2024 cycle as of last Thursday, up from 74% in the previous week, consultants AgRural said.
* European Union crop monitoring service MARS on Monday cut most of its forecasts for average grain yields in the EU this year, with the sharpest drop for maize (corn) and sunflower.
MARKETS NEWS
* An index of global shares steadied on Monday as investors weighed Biden's decision to end his reelection bid over the weekend, while a surprise rate cut by China's central bank failed to boost Asian markets. MKTS/GLOB
Reporting by Peter Hobson; Editing by Sherry Jacob-Phillips
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