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U.S. corn and soybean futures turned higher Thursday after six straight losing sessions, with analysts citing support from a new tax package provisionally enacted by Brazil’s government, Dow Jones reported.
The tax plan is expected to raise farm taxes in Brazil by ~20% and has many Brazilian farmers holding onto their grain instead of selling it into the world export market.
“Farmers have stopped selling grain, waiting to see if it gets approved by Congress,” Brian Splitt of AgMarket.net said, according to Dow Jones, adding that a prolonged slowdown by Brazil could leave buyers seeking alternative sources such as the U.S.
Also, the U.S. Department of Agriculture reported 152K metric tons of American corn was sold to unknown buyers.
CBOT corn (C_1:COM) for July delivery closed +3.2% to $6.45 1/2 per bushel, and July soybeans (S_1:COM) settled +1.9% to $12.00 per bushel, but July wheat (W_1:COM) ended -1.2% to $6.39 per bushel for a seventh straight daily loss.
ETFs: (NYSEARCA:CORN), (SOYB), (WEAT), (DBA), (MOO)
Corn had dropped 5.2% and soybeans had shed 5.7% during the six-day losing streak on a lack of adverse weather to derail the large crops planted throughout the Corn Belt, and the U.S. weather outlook apparently has not changed, according to Brian Hoops of Midwest Market Solutions.
“Weather looks great for the Midwest so there is really no fundamental reason for the bounce,” Hoops told Dow Jones.
Overall, the U.S. crop is in its best condition for this time of year since 2021, with the strong ratings weighing on grain prices recently.
