US soybean futures tumbled on Monday trading posting their biggest percentage drop in nearly one year, on selling sparked by anecdotal accounts of better-than-expected yields in the Midwest farm belt.
Global food prices remained steady in August, the United Nations food agency said Thursday, but warned that the game is not over as it was only the beginning of the harvest season.
Global food prices soared by 10% in July from a month ago, with maize and soybean reaching all-time peaks due to an unprecedented summer of droughts and high temperatures in both the United States and Eastern Europe, according to the World Bank Group’s latest Food Price Watch report.
Soy beans in Chicago climbed to their highest having advanced 0.4% on Thursday to 650.47 dollars the ton, while corn up 0.2% to 319.47 dollars the ton came closer to its record value of last August, 327.25 dollars. Wheat meantime slid 0.2% to 324.64 dollars the ton.
US and European wheat futures gained again on Thursday as importers took advantage of a price fall earlier in the week and as operators continued to anticipate Russia would drop out of export markets in the coming months due to drought-hit supply.
President Barack Obama announced an emergency purchase of up to 170 million dollars of meat and fish on Monday on a campaign trip to drought-hit Iowa, and accused Republican vice presidential candidate Paul Ryan of blocking disaster aid to farmers.
The commodities soy and corn’s prizes sky rocked on Thursday thanks to the severe drought that has been punishing the United States heartland. Soy and corn were being sold at record high of 638.89 dollars/ton and 320.26 dollars/ton respectively.
A worst-in-a-generation drought from stretching across the United States is damaging crops and rural economies and threatening to drive food prices to record levels. Agriculture, though a small part (1.2%) of the 15.5 trillion dollars US economy, had been one of the most resilient industries in the past three years as the country struggled to recover from the recession.
Next season, 2012/13 Brazilian soybean growers could be in place to jump from the world's No. 2 producer and dispute the US first place. Brazil's 2012-13 soybean production is expected to rise 25% from this season’s drought-punished, to 83.1 million tons.
Argentina's biggest grains exchange trimmed its forecast for 2011/12 soy output this week to 40.5 million tons, down from May's estimate of 40.9 million tons as harvesting enters the home stretch.