Soya hits six-month high

US soyabean futures soared to a six-month high on Monday as diminishing projections for the crop in Brazil, projected to be the top exporter of the oilseed, increased the need for ample US supply. Soyabeans for May delivery closed up 13-3/4 cents, or 1 percent, at $13.79-1/2 a bushel at the Chicago Board of Trade, paring gains after stronger advances earlier in the session.
Corn prices fell, while wheat moved modestly higher. CBOT May corn closed down 8-3/4 cents or 1.4 percent at $6.37-3/4 a bushel. US wheat prices rose on short-covering and concerns about poor weather in European growing areas, with CBOT May gaining 5-1/4 cents or 0.8 percent to $6.59-1/2 a bushel.
Increasing worries about crop damage from drought in Brazil revved up a battle for acres in the United States ahead of a key US Department of Agriculture prospective plantings report on Friday, analysts said. US farmers need to plant enough acres to meet global demand, as foreign buyers may shift purchases to the United States from South America due to Brazil's crop losses. However, US farmers are expected to raise plantings only slightly to 75.4 million acres from 75 million last year, according to a Reuters survey of analysts.
"The heart and soul of the bean market has been the report and the supply side and getting enough acres," said Mike Zuzolo, president of Global Commodity Analytics & Consulting. Crop forecaster AgRural helped renew supply concerns by cutting its outlook for Brazil's soya harvest by 1.9 percent from February to 66.7 million tons.
Top oilseed analyst Thomas Mielke of Oil World warned the research house could lower its estimate of Brazil's soya crop to as low as 64.5 million tonnes and that prices would likely top $14 a bushel. Last week, Oil World dropped its forecast by 2.2 percent to 66.5 million tonnes.
"The world supply of beans has been dwindling," said Tomm Pfitzenmaier, analyst for Summit Commodity Brokerage. "That brought funds flooding in to buy beans and has led to a lot of speculation about just how tight supplies could become this summer." Large speculators have responded to increasing concerns about supplies by raising their net long position on Chicago Board of Trade soyabean futures and options. They boosted long positions for a seventh straight week to the largest on record, regulatory data showed on Friday. Many traders expect the US Department of Agriculture will follow other forecasters and lower its estimate for Brazil's crop in a separate monthly report in April.