Soyabean futures at the Chicago Board of Trade rose early on Wednesday on a technical bounce, supported by strength in corn, traders said. Corn was sharply higher, nearly hitting the 20-cent trading limit, as worries that rain in the US Midwest this week would delay corn planting further.
Also, weather forecasting models were in disagreement early Wednesday, adding to the volatility. The US weather forecasting model was calling for wetter conditions in the six-to-10-day period, while the European model was drier.
May soyabeans were up 8-1/4 cents at $7.18 per bushel by 11 am CDT (1600 GMT). The back months were up 4-3/4 to 9-1/4 cents. May corn was 14 cents higher at $3.74-1/2 per bushel. Soyabeans were also technically oversold, falling to a near three-month low on Tuesday amid prospects for more US soyabean plantings than originally forecast.
The nine-day relative strength index for May soyabeans closed Tuesday at 26, within the zero-to-30 range viewed as indicating a technically oversold market. Corn is planted from mid-April to mid-May in the Midwest. If farmers can't get all their intended corn acres in by then, they can switch to soyabeans, which have a shorter growing cycle. Additionally, damaged wheat fields from an early April freeze could also be plowed under and planted to soyabeans, traders said.
The products followed soyabeans higher. May soyameal was up $2.10 per ton at $193, with the back months up $1.20 to $3.20. Soyabean oil was 0.40 to 0.46 cent per lb higher, with May up 0.41 cent at 32.25 cents. The US Census Bureau will release its March crush figures on Thursday morning.
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