Soybeans soar on tight supplies
U.S. soybean futures climbed Tuesday, with the spot July contract settling at a seven-month high on tight domestic stockpiles of the oilseed.
Chicago Board of Trade soybeans for July delivery rose 28 3/4 cents, or 1.9%, at $15.40 1/2. The November soybean contract climbed 8 cents, or 0.6%, to $13.27.
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.
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"Traders are still bullish on contracts that represent supplies from last year's harvest," said Brian Hoops, president of agricultural-advisory firm Midwest Market Solutions in Springfield, Mo. "Supplies remain very tight, reflected in record high basis levels for this time of year."
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Tight physical stockpiles of U.S. soybeans are supporting nearby prices as processors and livestock companies push for limited available supplies to cover demand needs through the summer.
Market watchers say consistent demand from soybean crushers taking advantage of favorable processing margins, as well as strong demand for soybean meal, helped boost prices.
The combination of higher cash and futures prices are working to cool demand for the tight U.S. supplies, directing interest to South American supplies or encouraging buyers to delay purchases to later in the year, said Sterling Smith, futures specialist with Citigroup Global Markets Inc. in Chicago.
Meanwhile, "new crop" futures, which are associated with crops currently being planted across the Farm Belt for harvest this fall, rose as well. Traders pushed prices higher amid the uncertainty surrounding 2013 production due to planting delays.
U.S. corn futures finished higher, with tight supplies buoying nearby contracts, while the uncertainty of 2013 production potential supported contracts for delivery later in the year.
CBOT corn for July delivery, the most actively traded contract, gained 9 1/2 cents, or 1.4%, at $6.59 1/2 a bushel. The December contract rose 4 3/4 cents, or 0.9%, to $5.50 3/4.
U.S. wheat futures finished higher, with winter wheat contracts supported by poor crop conditions in the southern Plains.
July wheat futures ended up seven cents, or 1%, at $6.96 3/4 a bushel at the Chicago Board of Trade. Kansas City Board of Trade July wheat climbed four cents, or 0.6%, to $7.30 a bushel. MGEX July wheat finished up 4 1/4 cents, or 0.5%, at $8.15 3/4 a bushel.
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(END) Dow Jones Newswires
June 11, 2013 14:58 ET (18:58 GMT)
DJ Soybeans Futures Hit Seven-Month High on Tight Supplies->copyright
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