US soybean futures on the Chicago Board of Trade closed higher Monday on a technical bounce after sliding to a seven-week low last week, traders said. Concerns about hotter weather moving into the US Midwest crop belt starting late this week provided support.
A possible heatwave - highs in the mid 90s to 100 degrees Fahrenheit - may extend into early August when soybeans set and fill pods, thus hurting yields. Given the amount of weather premium taken out of the market during July, it was time to add back a little, traders said.
Updated forecasts released near midday looked hotter, traders said. September soybeansended up 7-3/4 cents at $13.96-1/4 a bushel. Front-month August soy settled 1-1/2 cent higher at $14.00-1/4 but spent most of the session lower, under pressure from the moves in the nearby spread. August/September soy spread - trading at an inverse with August at a premium to September - raised expectations for commercial firms to post big deliveries on first-notice day Thursday. That helped the spread to correct.
Soymeal followed the strength in soybeans, with August meal ending up $1.10 per ton at $375.80. Soyoil recovered late to end firm; August up 0.13 cent at 59.30 cents per lb.
The weakness in Malaysian palm oil futures overnight contributed to the lower trend in soyoil most of the session, traders said. Commodity funds bought 2,000 soybean contracts, 1,000 soymeal and 500 soyoil. Commercials were net buyers of roughly 1,000 soyoil contracts.
As traders expected, mild weather across the Midwest during the past week improved the condition of the soy crop. USDA late Monday rated 62 percent of the crop good to excellent, up from 61 percent last week and 58 percent a year ago. But development continues to lag. Only 62 percent of soybeans were blooming vs 79 percent for the five-year average. USDA reported that 10.134 million bushels of soybeans were inspected for export last week, within estimates from 7-11 million. Weekly trade data from the Commodity Futures Trading Commission showed that large speculators slashed their net long positions across the complex in the week ended July 22. CFTC's supplemental trade report showed that large specs cut their net longs in soybeans by roughly 18,400 contracts to 62,630. In soyoil, they cut their longs by about 7,860 lots to 10,360.
CFTC futures/options report showed that large speculators reduced their net long soymeal position by roughly 14,430 lots to 36,220. Midwest basis bids for soybeans held steady late Monday amid quiet farmer sales, dealers said.
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