The Chicago Board of Trade soyabean market closed lower on Friday after a volatile session with weather unknowns driving the market up then down, traders said. There were conflicting outlooks on how much rain will move through the parched areas of the eastern US Midwest. Some forecasters were calling for up two to four inches over the dry areas of Illinois, while others expected much less with rainfall of 0.10 to 0.50, weather forecasters said.
Indiana and Ohio were expected to see good coverage. "The market believes the wetter version," said Vice Lesbians, a floor broker with A.G. Edwards.
July soyabeans closed 7 cents lower at $6.66-1/4 per bushel, while the deferred were 4-1/4 to 6-3/4 cents weaker. New-crop November was down 6-1/4 at $6.78.
The market opened higher, supported by a bigger-than-expected drop in US end stocks made by the US Department of Agriculture on Friday and weather jitters, traders said.
But traders sold the higher open, taking profits before the weekend. Funds sold about 3,000-3,500 soyabean contracts. Cargill Investor Services and Rand Financial each sold 1,000-1,500, traders said.
"I think on Sunday night, this market could be up 25 cents or down 25 cents, depending on whether this moisture turns up this weekend. It's very important to us.
But as far as today, this crop report wasn't really all that bullish or all that bearish. A little friendly because we did get the reductions in carryout," said Roy Huckabay, an analyst with The Linn Group, a Chicago trade house.
USDA estimated US 2004/05 soya end stocks at 320 million bushels, down from USA's may forecast for 355 million and the average trade estimate of 330 million.
The drop in stocks reflected an increase in soyabeans used by crushers and sold for export. US 2005/06 soya stocks were pegged at 255 million bushels, below last month's forecast of 290 million bushels.
Some underpinning stemmed from outlooks that Asian soya rust could be moving northward as Tropical Storm Arlene hits. The USA's rust-monitoring Web site said on Thursday that Tropical Storm Airline's path across the Gulf of Mexico could blow soyabean rust spores into Alabama and neighbouring states by early next week.
On Friday was also the first day that the expanded speculative position limits going into effect. Weakness in the US cash markets as business was slow contributed to the drop in futures, traders said.
The South American soya contract settled lower, with July down 9 cents at $6.54 per bushel. No trades were reported. The soyameal market turned lower following soyabeans.
Softer cash markets worldwide, as end users turn to cheaper sources for high protein in feed rations was bearish. July was under added pressure as firms rolled nearby long positions before the start of the delivery period at month's end.
US 2004/05 and 2005/06 meal stocks were left unchanged at 250,000 tons. July soyameal closed $1.50 per ton lower at $211.40 per ton, while the deferred were down $1 to up 20 cents.
Reminders of ample supplies of US soyaoil stocks pressured CBOT soyaoil futures. USDA raised its US 2004/05 end oil stocks to 1.526 billion lbs. from 1.241 billion.
July soyaoil closed 0.39 cent at 22.74 cents per lb., with the deferred down 0.15 to 0.41 cent. Malaysian palm oil futures closed higher overnight.
Funds sold about 2,500 soyameal lots and 3,000-4,000 soyaoil, traders said.
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