Soybean prices well supported
Tight physical supply due to U.S. weather woes and demand, particularly from China, are likely to keep soybean prices supported this week.
Okato Shoji, deputy general manager Kaname Gokon in Tokyo, said demand for the grain from China, the world's largest importer, is likely to remain steady, providing support to prices even as near-term physical supply is tight.
Soybean futures on China's Dalian Commodity Exchange settled higher Wednesday amid record-high soybean imports in June. Shipments from Brazil, the world's second-largest soybean exporter after the U.S., surged after port congestion eased, driving China's imports up 23% from a year earlier to 6.93 million tons, said the country's General Administration of Customs Wednesday.
On Tuesday, July Chicago Board of Trade soybean futures rose 4 cents, or 0.2%, to $16.13 1/4 a bushel, a nine-month closing high for the front month contract. November soybeans rose 24 cents, or 1.9%, to $12.76 1/4 a bushel, a two-week closing high.
CBOT prices got an extra boost Tuesday from worries about the weather. Rainfall has been ample and temperatures have been cool for much of the summer in the U.S., creating favorable growing conditions for crops in the Farm Belt. But forecasts on Tuesday suggested hot, dry weather could move into the Midwest for much of next week, raising worries about potential damage to crops at a time when many corn plants are approaching their delicate pollination phase. A lower supply of corn would spur buyers to turn to soybeans, which is a close substitute.
Okato Shoji's Mr. Gokon tipped July CBOT soybeans to stay above $16 a bushel, while August soybeans will breach $15 a bushel. November soybeans meanwhile will likely to test $13 a bushel.
In other news, private exporters reported to the U.S. Department of Agriculture export sales of 120,000 metric tons of soybeans for delivery to China during the 2013/2014 marketing year, the USDA said Monday. The 2013/2014 marketing year for soybeans will begin Sept. 1.
--Zhoudong Shangguan in Beijing, Owen Fletcher in Chicago and Kareema Clark in Washington contributed to this article.
Write to Huileng Tan at firstname.lastname@example.org
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(END) Dow Jones Newswires
July 10, 2013 06:02 ET (10:02 GMT)