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CBOT soybeans jump $0.70 in 10 days

Agriculture.com Staff 05/16/2007 @ 2:00pm

With world currencies topping out against the U.S. dollar, China purchases, and fewer corn acres switching to soybeans, the CBOT July soybean futures price surged higher Wednesday.

At the close, CBOT July soybeans finished $.14 higher at $7.92 per bushel. The CBOT Nov soybean contract jumped $0.14 to $8.21.

Since May 7, 2007, the CBOT July soybean futures contract has surged $0.70 higher.

Jason Ward, North Star Commodity Investment Company, said the soybean market is being driven by world demand and currency issues.

"You have the European currency, the Canadian dollar topping out," Ward said. Plus, the Brazilian real has risen to six year highs. Now, the U.S. dollar is bottoming, and the U.S. soybeans are the cheapest on the world market that they will be. As a result, China thinks U.S. soybeans are a bargain compared to Brazilian beans."

Beginning in April, a wet start to the corn season had many believing producers were going to switch acres to soybeans.

"At that time, the bean market was beaten down $0.50," Ward said. "So, really, we are just gaining back what we lost. But, China's purchase of 70 million bushels of U.S. soybeans on Wednesday sure helped. That equates to one and a half months worth of exports."

The bullish movement for soybeans looks to be extending into Thursday, Ward said.

"I think $8.28 is now the price for the Nov. contract to watch for," Ward said. "If it goes there, watch for soybean prices to reach $9.00."

With world currencies topping out against the U.S. dollar, China purchases, and fewer corn acres switching to soybeans, the CBOT July soybean futures price surged higher Wednesday.

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