U.S. grains: Soybeans extend run on S. America worries

Chicago | Reuters — U.S. soybeans rose for the third consecutive session on Monday to hit a five-month high as rains stalled the harvest in South America and data from Washington confirmed robust shipments of the oilseed out of the U.S.

Corn futures declined the second session in a row as traders took profits after prices hit the highest level since September last week. Wheat futures jumped one per cent as bitter cold again threatened to damage the dormant U.S. crop.

“We’re seeing bull spreading (on soybeans),” said analyst Jason Roose of U.S. Commodities. “We have strong soymeal demand from a local standpoint and strong bean exports. Right now, we’re not getting any bearish news.”

Soybeans for March delivery jumped 15-3/4 cents, or 1.2 per cent, to $13.86-1/2 per bushel at the Chicago Board of Trade, touching the highest level since Sept. 13 (all figures US$). March soymeal surged more than two per cent to hit a contract high.

Excessive rainfall that slowed the harvest in Brazil’s top soy state of Mato Grosso could damage what is expected to be a record crop, analysts at AgRural said in a weekly report.

The harvest delays could extend the export season in the U.S., where U.S. shippers already have loaded five million more tonnes of soybeans so far in the 2013-14 marketing season that started on Sept. 1 than a year earlier. U.S. Agriculture Department data on Monday showed 1.27 million tonnes of soybeans were inspected for shipment at U.S. ports for the week ended on Feb. 20, a figure within analysts’ expectations.

Investment fund interest has also bolstered soybean futures, with noncommercial traders, including hedge funds, raising their net long position in soybeans in the week to Feb. 18, U.S. regulatory data released on Friday showed.

“Weather risk has returned to agri-commodity markets,” Rabobank analysts said in a note, citing weather-fuelled price gains in soy, wheat, coffee and sugar that led funds to extend net long positions or cut short ones.

Oats rise

Oats futures soared to an all-time high of $4.84-3/4 per bushel as continued slow rail transportation out of Canada prompted investment fund buying, traders said.

“Everything is catching a bid a little bit today because the macro markets are firm,” A/C Trading analyst Jim Gerlach said.

But some traders said the rally in soybeans might be fragile given a U.S. government outlook on Friday for a record harvest this year that would raise stocks and lower prices.

At its annual Agricultural Outlook conference, USDA also forecast a record-large corn crop, despite an expected drop in planted area.

CBOT March corn settled 1-1/2 cent lower at $4.51-1/2 per bushel, paring earlier losses in the session.

CBOT March wheat gained eight cents to $6.17-3/4 per bushel, rebounding after two sessions of declines. A return to freezing temperatures in the U.S. Midwest and southern Plains regions could minimally damage wheat fields not protected by blankets of snowcover, the analysts said.

The ousting of Ukraine President Viktor Yanukovich reduced risk premium in the grains complex that last week led to higher corn export prices in neighbouring Russia. Closer ties to the European Union could also expand grain production and trade in Ukraine, analysts said.

— Michael Hirtzer reports on ag commodity markets for Reuters from Chicago. Additional reporting for Reuters by Julie Ingwersen in Chicago, Gus Trompiz in Paris and Naveen Thukral in Singapore.

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