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Soybeans mixed; spot contracts surge

07/05/2013 @ 9:44am

U.S. soybean futures are trading mixed Friday, with contracts for near-term delivery higher on continued concerns about tight current supplies.

Chicago Board of Trade soybeans for July delivery gained 8 1/2 cents, or 0.5%, to $15.92 a bushel. November soybeans fell 4 1/2 cents, or 0.4%, to $12.46 1/4.

Traders are still focused on tight near-term supplies, with spot prices climbing in an attempt to ration remaining supplies from last year's harvest. "New crop" futures, such as the November contract, that represent crops that will be harvested in autumn slumped on improved outlooks for 2013 production.

"We still have a very tight supply situation, but the anticipation of ideal weather for developing crops is weighing on contracts for delivery later in the year," said Jason Roose, analyst with brokerage U.S. Commodities in West Des Moines, Iowa.

A tight near-term supply situation has supported soybean prices for months, since droughts last year in the three major producers of the oilseed--the U.S., Brazil and Argentina--shrunk available stockpiles.

"Nearby contracts are supported by domestic processors pushing for supplies for demand needs through the summer," Mr. Roose said.

"New crop" futures such as the November contract that represents crops to be harvested in autumn are lower, as investors continue to brace for U.S. supplies to rebuild substantially in 2013.

Private weather forecaster Telvent DTN in its morning forecast said crops in the U.S. Farm Belt will likely benefit from a turn to warmer and somewhat higher temperatures during the next 10 days. For now it appears there is no a significant period of heat and dryness on tap for the Farm Belt, Telvent added in the forecast.

"Two-sided trade is featured in a thinly traded market," Mr. Roose said. "A lot of people are still on holiday, with traders taking an extended holiday break after Thursday's Independence Day holiday."

Meanwhile, the U.S. Department of Agriculture reported net-export sales of 369,700 metric tons of soybeans in the week through June 27, including 120,600 tons for delivery in the current marketing year that ends Aug. 31 and the rest for the next crop year. Analysts had expected total net sales of 200,000 to 500,000 tons.

Write to Andrew Johnson Jr. at andrew.johnsonjr@dowjones.com.
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(END) Dow Jones Newswires
July 05, 2013 10:05 ET (14:05 GMT)
DJ Soybean Futures Mixed; Tight Supplies Support Spot Contracts->copyright

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