Tech trading sends soybeans higher
U.S. soybean futures rose Monday, boosted by technical buying and uncertainty about the weather for South America's soy crop.
Chicago Board of Trade soybean futures for January delivery settled up six cents, or 0.4%, at $14.24 3/4 a bushel.
Soybean futures rose on technical buying, as some market participants expect prices to rise further after steep recent losses, due both to tight supplies and the commodity's trading pattern.
"What drove it higher was probably just follow-through on Friday's rally," said Anne Frick, senior oilseed analyst with Jefferies Bache in New York. "We've had a big selloff ... You could argue that there's a kind of a bottoming pattern developing in the market."
Soybeans also benefited from mixed views on the weather for South American crops. World soybean supplies are historically tight after droughts in both South America and the U.S. earlier this year. That has left traders looking toward the next soy crops in Brazil and Argentina to see whether supply levels will rebound.
Traders on Monday had mixed views of the weather in South America. Some said futures rose due to concerns about dryness in parts of Brazil and too much rain in Argentina.
Futures also rose after the U.S. Department of Agriculture on Monday morning reported fresh soybean oil sales of 20,000 metric tons to unknown destinations. The sales continue a monthlong trend of daily sales announcements, which are typically rare for soybean oil.
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Soybeans reached the day's highest levels in the morning. They then pared their gains after a USDA report showed a smaller amount of soybeans than expected had been recently prepared for export.
The USDA said 45.5 million bushels of soybeans had been inspected or weighed for export in the week through Thursday, well below the range of 57 million to 63 million bushels that analysts had expected. The figure was also down from 66.8 million bushels the prior week.
Such a drop is seasonally normal, but it had been weeks since soybean export inspections showed much weakness, Ms. Frick said.
Corn and wheat futures both rose slightly on hopes for greater export demand for U.S. supplies of the two crops.