U.S. grains: Soy hits one-month top on export demand

Chicago | Reuters — U.S. soybean futures set a one-month high on Thursday on robust export demand coupled with short covering and strength in cash markets, traders said.

Corn followed the firm trend, drawing additional support from strength in other commodities, including crude oil. The 19-market Thomson Reuters CoreCommodity Index was up 0.2 per cent after reaching its highest level since May.

But wheat ended fractionally lower.

Chicago Board of Trade November soybeans settled up 15-1/2 cents at $9.76 per bushel after reaching $9.78-1/4, the highest level since Aug. 10 (all figures US$). CBOT December corn ended up 2-3/4 cents at $3.54-1/4 per bushel while December wheat fell 1/4 cent to $4.43 a bushel.

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Soybeans rose after the U.S. Department of Agriculture reported export sales of U.S. soybeans in the latest week at 1.6 million tonnes, topping a range of trade expectations for one million to 1.3 million tonnes.

Through its daily reporting system, USDA also said private exporters sold another 198,000 tonnes of U.S. soybeans to China.

“I really like the demand in beans and the soy complex overall. Funds have been short; this might neutralize their positions,” said Bill Gentry, a broker at Risk Management Commodities.

Firm cash markets lent support. Cash values for soybeans and soymeal at the U.S. Gulf export terminal have firmed in recent days, due in part to exporters seeking high-quality soybeans for blending with some damaged supplies.

Soymeal end-users, such as feed mixers and hog producers, have been trying to cover short-term needs for the protein-rich feed ingredient as they wait for the soybean harvest to pick up, one cash broker said. CBOT December soymeal rose 2.5 per cent to settle at $313.10 per short ton.

CBOT corn was firm but rangebound as traders awaited yield reports from the harvest, which is just getting started in the heart of the Midwest. The U.S. corn crop is maturing more slowly than usual, but freeze threats remain low for the next two weeks.

Wheat struggled to stay in positive territory after the CBOT December contract reached a one-month high of $4.50-1/2 a bushel. Ample global wheat supplies continue to hang over the market, although dry conditions are threatening yield prospects in parts of Australia, a key exporter.

“Notable dryness will continue to lower yield potential in much of New South Wales, Queensland, and western portions of South Australia,” MDA Weather Services said in a note to clients.

— Julie Ingwersen is a commodities correspondent for Reuters in Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Gus Trompiz in Paris.

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