Futures on soybean closed with a loss on Monday amid the strengthened US dollar.
By the end of CBOT trades July futures on soybean cheapened by 6 ½ % and constituted 13.73 ¾ dollars per bushel, while November contract grew by ¼ cent up to 13.50 ¾ US dollars per bushel.
The major factor on the market on Monday was strengthening US dollar amid remaining problems with debts in Europe which slowed down a rosy outlook of the regional economic growth.
The uprise of the American currency rendered USD denominated futures more expensive for those operating with other currencies.
Moreover, concerns over larger areas under soybean production due to bad weather in the US Middle West have been bringing the prices down.
Market participants note that the lack of fresh data on ask/demand are unfavourable for soybean as many experts have been pointing at the weakness of import and domestic demand. It contributes to the decline in the prices.
Moreover, the unprecedented soybean harvest in South America reduced demand for the US exports. Meanwhile, Brazil’s soybean is much cheaper than American soybean which represents another negative factor for the market as rivalry in sales activity has been increasingly tough.
China, the leader in importing American soybean, has lately decreased the volume of its purchases amid vast soybean inventories in it ports.
On the other hand, the market can only be supported by downpours expected in the USA this week. However, soybean is believed to be resistant to unfavourable weather conditions.
Furthermore, market participants remember that the US soybean reserves are at record low and farmers need to have substantial harvest to replenish them.
