Soybeans post steep decline on Midwest weather, fund selling

CHICAGO - U.S. soybean futures plunged 5.3 percent on Tuesday after rain in dry areas of the Midwest during the three-day holiday weekend bolstered harvest prospects for the developing crop, traders said.

Signs of weakening export demand and fund liquidation added more pressure to the market, which hit a one-week low.

The weather outlook also weighed on corn, which touched its lowest level since October 2014 before bargain buyers pulled it from session lows.

Market watchers shrugged off forecasts for high temperatures to hit key growing areas in the coming days, saying the outlook did not call for the Midwest to heat up enough to stress the crops as they pass through key development phases.

'The weather is simply not hugely threatening to the corn this year, as temps are not searing any plants, and rains appear to be pretty much spot on ‘normal',” Charlie Sernatinger, global head of grain futures at ED & F Man Capital said in a note to clients.

CBOT December corn futures settled down 9 cents at $3.58 a bushel.

The outlook for more rain in key growing areas of the Midwest during the next two weeks outweighed concerns about some dry conditions in about 15 to 20 percent of the Midwest, including southeast Iowa and western Illinois.

'The timely rains occurring in other spots and a lack of severe heat will aid pollinating corn,” Forecaster Commodity Weather Group said in a note to clients.

CBOT November soybeans were 60-1/4 cents lower at $10.77-1/4 a bushel.

The U.S. Agriculture Department on Tuesday morning said export inspections of soybeans totaled just 191,426 tonnes in the latest week, down from 295,816 a week ago and below the low end of analysts' forecasts.