Soybean futures at the Chicago Board of Trade rallied to a 34-year high for the sixth consecutive session on Friday on continued technical buying, with support stemming from an active export pace and outlooks for a sharp drawdown in supplies, traders said.
The US Senate's passage late Thursday of an energy bill to boost biofuel production five-fold to 36 billion gallons by 2022 was another sign of the demand for agricultural products. "It was short covering going into the weekend ... predicated on the fact that we're still not rationing demand," said Don Roose, analyst with US Commodities. "We went through a week of strong export sales."
There was also spillover technical buying from soymeal, which hit a three-top every day this week. January soybeans closed 11 cents higher at $11.57 a bushel, after rising to $11.64-1/2. January soymeal ended $4.30 per ton firmer at $325.90, just below its high of $330.
The soyoil market ended mostly lower, with January down 0.04 cent at 46.22 cents a lb. The weaker energy markets weighed on prices and spurred long meal/short oil spreading. The December soyoil and soymeal contracts expired at midday.
Estimated volume was moderate to large. In soybeans, an estimated 154,009 futures and 44,514 options traded. Soymeal trade was pegged at 52,725 futures and 3,463 options. Estimated soyoil trade was 64,081 futures and 3,601 options. Commodity funds bought 3,000 soybean futures, 4,000 soymeal contracts and 1,000 soyoil.
The market rallied despite a stronger dollar, a smaller-than-expected monthly crush data, surprisingly heavy rains in Argentina in the past day, and a private analytical firm raising its estimate of 2008 US soybean plantings. "I really think today was an important day because we had some negative news, and the market went right through it," said Rich Feltes, analyst with MF Global Research.
Research firm Informa Economics estimated 2008 US soy plantings at 70 million acres, up from its November forecast of 68.1 million and the 63.7 million seeded this year.
The National Oilseed Processors Association report said its members crushed 146.748 million bushels of soybeans in November, compared with the average analyst estimate of 150.7 million bushels and below the 155 million bushels processed in October. Additionally, US soyoil stocks grew to 2.689 billion lbs from 2.680 billion last month, NOPA said.
Soymeal exports were 399,199 tons versus 562,420 tons in October. Overnight, there were only 16 December soymeal deliveries, with the ADM house account stopping 11 lots - a supportive sign. Soyoil deliveries were also light at 79 lots and an R.J. tomer stopped all of the soyoil.
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