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Soybeans rise on cash, export markets

10/22/2012 @ 3:31pm

U.S. soybean futures rose Monday, boosted by strong cash markets and the latest sign of strong export demand.

Chicago Board of Trade November soybean futures rose 12 1/4 cents, or 0.8%, to $15.46 1/2 a bushel.

U.S. cash markets for soybeans are unusually strong for harvest season, due to tight domestic and world supplies after the severe U.S. drought widely damaged crops this summer. The flow of new physical supplies to elevators is slowing as harvest winds down, keeping cash markets strong.

"It's really pretty unheard of what's going on for harvest time, that cash markets are so strong," said Jason Britt, president of brokerage Central States Commodities in Kansas City, Mo.

Continued signs of strong export demand also lifted soybean futures. The U.S. Department of Agriculture on Monday said 61.422 million bushels of soybeans had been inspected or weighed for export in the week ended Thursday, up 5.3% from a week earlier and above the high end of analysts' expectations for 40 million to 50 million bushels.

"These bean exports are phenomenal," Mr. Britt said. Soybean futures may have to rise back to above $16 a bushel to slow demand enough to account for tight supplies, he said.

Positive technical signals also boosted soybeans, after futures recovered from lower trading levels last week.

November soybean options expire on Friday, which could lead to volatile trading this week as market participants even up their positions in the options market, traders said.

Wheat futures rose on optimism that U.S. exports of the grain will pick up. Ukraine on Friday said it may run out of exportable wheat stocks next month, fueling hope for greater U.S. exports due to reduced competition.

CBOT December wheat rose 5 3/4 cents, or 0.7%, to $8.78 1/4 a bushel. KCBT December wheat rose 7 1/2 cents, or 0.8%, to $9.15 1/2 a bushel. MGEX December wheat rose 5 cents, or 0.5%, to $9.47 1/2 a bushel.

Corn futures settled slightly down, as traders continue to weigh weak demand against tight supplies. Some traders anticipate a trading range between $7.30 or $7.50 a bushel at the low end and $8 a bushel at the high end until the government issues a final estimate for the U.S. corn harvest, as supply and demand may already be roughly balanced at current prices.

December corn futures were nearly unchanged, falling 1/4 cent to $7.61 1/4 a bushel.

(Andrew Johnson Jr. contributed to this article.)
-Write to Owen Fletcher at owen.fletcher@dowjones.com
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(END) Dow Jones Newswires
October 22, 2012 15:39 ET (19:39 GMT)
DJ U.S. GRAIN AND SOY REVIEW: Soy Rises on Cash Markets, Exports->copyright

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