GRAINS-Soybeans, corn slide on macroeconomic fears, biofuel worries
By Julie Ingwersen
CHICAGO, Aug 20 (Reuters) - U.S. soybean futures fell to their lowest in nearly two months on Friday and corn set a near one-month low on macroeconomic concerns along with beneficial rains in the western Midwest and Plains, analysts said.
Soyoil futures fell more than 5% on reports that the U.S. Environmental Protection Agency (EPA) will recommend lowering the nation's biofuel blending mandates.
Wheat futures followed the weaker trend.
As of 1:05 p.m. CDT (1805 GMT), Chicago Board of Trade November soybeans were down 34-1/2 cents at $12.85-1/2 per bushel after dipping to $12.77-1/4, the contract's lowest since June 28.
Benchmark December soyoil was down 3.40 cents at 56.52 cents per pound after falling its daily 3.5-cent maximum to 56.42 cents, a two-month low. CBOT December corn was down 14 cents at $5.36-3/4 a bushel.
Soyoil is the main U.S. feed stock for biodiesel fuel and corn is used for ethanol. The EPA is expected to recommend to the White House lowering the nation's biofuel blending mandates below 2020 levels, two sources familiar with the matter said, in what would be a blow to the biofuels industry.
Grains faced additional pressure from concerns about global economic growth amid rising coronavirus cases, which have weighed down crude oil and boosted safe-haven assets like gold.
"We are seeing a risk-off session," said Terry Reilly, senior analyst with Futures International in Chicago. "There are global economic concerns ... That is shaking up the commodity markets in general, which is also spilling into agricultural markets," Reilly said.
Commodity funds hold a net long position in CBOT corn and soybean futures, leaving those markets prone to bouts of long liquidation.
Also, forecasts called for beneficial rains through this weekend in the Dakotas and surrounding U.S. crop areas that have struggled with months of drought.
"The heaviest rainfall is expected in North Dakota, which should finally begin to ease dryness, although the rain is likely coming too late to dramatically improve crop yields," space technology company Maxar said in a client note.
Meanwhile, the Pro Farmer Midwest Crop Tour concluded late Thursday, projected above-average corn yield prospects in Iowa and below-average prospects in Minnesota.
(Reporting by Julie Ingwersen in Chicago, Gus Trompiz in Paris and Naveen Thukral in Singapore; editing by Uttaresh.V and Susan Fenton)
