CHICAGO, ILLINOIS, US — Grain markets slid on Tuesday amid concerns from the fallout of the COVID-19 pandemic, Reuters reported.
Soybean futures were lower amid concerns that demand for livestock feed will drop as several meat packing plants announced closings. Several processing plants have closed after workers tested positive for COVID-19.
Arlan Suderman, chief commodities economist at INTL FCStone, told Reuters a short-term boost is likely in feed demand.
“You can’t just slow down production that fast, but that’s the thinking of fund managers — plant closures means less feed usage,” he said. “Near term, that’s simply not the case.”
It is unlikely demand from China will offset the loss from lower feed demand, analysts said. Soybean imports by China fell 13% in March from a year earlier to a more than five-year low, after rains delayed cargoes from Brazil.
Corn was also lower, as it tracked crude oil markets. More than a third of US corn goes to ethanol production, which has slowed significantly.
Wheat eased as steady US crop ratings tempered concern about frost damage in parts of the US Plains, Reuters said.
The US Department of Agriculture (USDA) estimated 62% of US winter wheat was in good or excellent condition.
The favorable crop ratings distracted from a potentially damaging frost in part of the US Great Plains.
“Freeze damage in wheat is difficult to sustain a rally on,” Suderman said. “It takes some time to assess the damage and its impact.”
Egypt, the world's largest wheat buyer, bought 120,000 tonnes of Russian wheat in a tender, which was less than anticipated.
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