European rapemeal prices were lifted by a weak euro on Wednesday, while soymeal steadied on renewed concerns over soybean crops in the United States. EU rapemeal stocks on the European feeds and meals market rose between 1 euro and 6 euros per tonne, adding to small gains made the previous day.
Traders said the rise was partially due to the stronger dollar against the euro. The dollar hit a 3-1/2 month high against a basket of currencies, buoyed by renewed hopes for a US Federal Reserve interest rate rise in September.
Dollar strength pushed the euro to a two-week low of $1.0847 earlier in the day. A weaker euro usually lifts prices because it makes meals and feeds priced in the currency cheaper.
“It’s definitely impacting prices that are in euros,” said one European trader. “It makes it even more difficult to sell because people are already not interested.”
Another trader said part of the lift in prices was in response to trading activity on Tuesday, after a relatively subdued market over the past month.
“It’s a short covering of yesterday’s business,” the trader said. “Traders are pushing up the market because there are a lot of dealers who are short in the market and the sellers know that, so they push up the prices.”
Meanwhile, European asking prices for soymeal were stable as the market anticipated the US Department of Agriculture potentially cutting its estimates of soybean plantings and stocks in a report next week.
South American soymeal prices were broadly unchanged, with Brazilian high-protein stocks dipping slightly by up to $2 per tonne. Argentine high-protein soymeal for Jan16/Mar16 shipment dropped $11 per tonne, but all other positions remained steady.
EU soymeal was also stable, although stocks for Oct15 delivery rose by $9 per tonne.
Chicago soybean futures made modest gains, with the November SX5 contract rising 0.9 percent to $9.50-3/4 per tonne at 1632 GMT. Soymeal futures were also higher, with August stocks inching up by 1.25 percent to $354.70 per tonne.
Soybean and meal prices have recently been pressured by good weather conditions in the United States, after heavy rain earlier in the year fuelled concerns over reduced output.