Oilseeds lead grains lower, as crude oil's dip to $90 weighs on ags
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Pause in Iran-US hostilities sinks Brent crude to $90/Bbl
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Other commodities dragged lower. Oilseeds weakest among grains
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Corn holds firm in Paris, as forecasts show further European heat
Oilseeds led a retreat in grain prices, as de-escalation in Iran-US hostilities dragged Brent crude back to $90/t, depressing with it the value of ags used in making biofuels.
A pause by Iran and US and tit-for-tat strikes, after two weeks, dampened jitters over Middle East oil supplies, allowing a retreat in prices of crude and markets, such as other energy contracts and many grains, linked to it.
Brent crude futures for September-26, which touched $102/Bbl on Thursday, sank below $88/Bbl in early deals on Monday, before recovering to $90.15/Bbl, down 6.9% for the session.
Even so, Brent crude remains up more than 20% since before the US and Israel opened strikes on Iran on 28 February. The daily rate of vessels passing through the Strait of Hormuz was below 10 over the weekend despite the pause in Iran-US conflict, according to Kpler, and shipping through the Red Sea corridor has now been caught up in attacks by Yemeni Houthis on Saudi Arabian oil infrastructure.
With crude oil, a commodity bellwether, declining on Monday, many other raw materials sank too. The Bcom commodities index dipped by 2.0%, although metals including copper held firm on hopes that lower oil prices would enhance economic growth.
Among grains, rapeseed, which is used largely to makes biodiesel, fell by 2.6% for November-26 futures in late trading in Paris, back below €540/t, before finding support at their 20-day moving average.
Soyoil, the top US biodiesel feedstock, sank by 3.3% in Chicago for September-26 delivery, to test support at its 50-day moving average.
Chicago soybeans for September-26 were dragged 3.2% lower in turn, before finding support at the $12.00/Bu mark.
The selling in crude oil and oilseeds weighed on cereals too, although losses were more limited. Chicago soft red winter wheat for September-26 shed 1.8%, while Paris milling wheat for September-26 dipped by 1.5%.
London feed wheat for November-26 traded unchanged in late deals, at £199.75/t, recovering some of the ground lost against Paris wheat during the initial rally on worries over Russian and Ukrainian exports.
The concerns over Black Sea shipments remained live, with no evidence of Russia-Ukraine de-scalation talks, rumours of which depressed wheat values on Friday.
Kazakhstan’s president, Kassym-Jomart Tokayev, urged Russian President Vladimir Putin to considering halting the Ukraine war and returning to a renewed version of the 2022 Istanbul peace talks. Mr Putin was reported as viewing such a halt as impossible.
Paris corn futures for November-26 eased a more modest 0.3% in late trading, supported by forecasts for hot and dry weather through most of Europe over the next week.
Eastern Europe, where corn crops have so car largely escaped the heat damage witnessed in France, is expected to remain unusually hot through at least the first 10 days of August.
