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Demand boosts soybeans Thursday

08/08/2013 @ 3:43pm

U.S. soybean futures settled higher Thursday, boosted by positioning ahead of a government crop report.

Chicago Board of Trade August soybeans, thinly traded ahead of the contract's expiration on Aug. 14, settled up 28 cents or 2.1% at $13.55 3/4 a bushel.

The U.S. Department of Agriculture's monthly crop report on Monday will include updated forecasts for the size of this year's soy, corn and wheat harvests. The report could cause prices to swing sharply if the USDA estimates are far off from expected levels.

That prospect led some traders with bearish bets on soybeans to exit them by buying futures, pushing prices higher on Thursday.

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Soybean futures have fallen sharply in recent weeks as weather has been generally favorable for crop growth, fueling expectations of a large harvest this fall.

"You've had a market here that has been really beat up the past couple of weeks, and to see a rebound is not really a surprise," said Joe Vaclavik, president of Chicago brokerage Standard Grain Inc.

Uncertainty about the final size of the crop also fueled buying on Thursday. While weather conditions have been favorable overall, analysts are worried about dryness in parts of the western Farm Belt, and slower-than-usual development of the crop.

Iowa was 16.5% affected by moderate drought as of Tuesday morning, compared to nearly zero a week earlier, the U.S. Drought Monitor showed Thursday. The drought-affected area is in western Iowa.

Soybeans also rose Thursday on optimism about export demand. Export sales in a weekly U.S. government report Thursday morning were better than expected, and Chinese data showed the country imported a record amount of soybeans in July.

The U.S. Department of Agriculture on Thursday morning said private exporters reported net sales of 1.097 million metric tons of soybeans in the week through Aug. 1, including 79,400 tons for delivery in the current marketing year that ends Aug. 31. Analysts had expected total net sales of 550,000 to 1.05 million tons.

Corn futures also rose on positioning ahead of the USDA report and concerns about dryness in parts of the Farm Belt.

September corn rose 5 1/4 cents or 1.1% to $4.73 1/2 a bushel.

Wheat futures fell, pressured by worries about weaker export demand and expectations for ample world wheat supplies during the current crop year.

CBOT September wheat fell 2 1/4 cents or 0.3% to $6.41 1/4 a bushel, a fresh 13-month closing low for the front-month contract. KCBT September wheat rose 3 cents or 0.4% to $7.02 a bushel. MGEX September wheat fell 2 3/4 cents or 0.4% to $7.33 1/2 a bushel.


Write to Owen Fletcher at owen.fletcher@dowjones.com
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(END) Dow Jones Newswires
August 08, 2013 15:55 ET (19:55 GMT)
DJ UPDATE: U.S. Soybeans Settle Higher On Pre-USDA Positioning->copyright


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