Soyabean futures on the Chicago Board of Trade closed lower on Thursday, pressured by the profit-taking setback in corn after the government released its monthly crop data, traders said.
"Corn has been the leader. Basically its failure, no doubt, contributed to the weakness that we saw in wheat and soyabeans," said Bill Nelson, analyst with A.G. Edwards. November soyabeans closed 8-3/4 cents lower at $6.57-1/2 per bushel falling 1 percent.
January ended 8-1/2 down at $6.69-1/2. December corn settled down 7-3/4 cents at $3.50. Soyabeans dived shortly after the open, setting back from Wednesday's climb to contract highs and pressured by a soft start in corn.
The soya market tends to track corn, trying to keep pace as the current price relationship is enticing US farmers to plant a lot more corn next spring at the expense of soyabeans.
Soya prices can't get too far behind corn or soyabeans will lose additional acreage, analysts said. Outlooks for ethanol manufacturers to increase their use of corn in the year's ahead support corn. The government raised its estimate for the 2006 US soyabean crop by 15 million bushels to a record 3.204 billion bushels, which would surpass the all-time high of 3.1 billion harvested in 2004.
The bigger production figure spilled over to a 10-million-bushel increase in the government's US 2006/07 soya end stocks estimate to 565 million bushels.
In contrast, USDA cut its forecast for this year's US corn crop. Even though USA's number weren't exactly what most traders expected, the government did raise its US soya crop estimate and cut its corn forecast, as traders had been forecasting.
"It's a cloche, 'buy the rumour, sell the fact' but there has been a lot of buying interest going into this report," Nelson said. Soyabeans climbed to contract highs in most months on Wednesday, while corn hit a 10-year top. Weekly export data was supportive.
USDA said 768,200 tonnes of US soyabeans were sold for export last week, above estimates for 500,000 to 700,000 tonnes. On a negative note, there was another round of heavy November deliveries of 1,351 lots. Scattered stoppers met them. Spot Midwest basis bids for soyabeans were steady on Thursday, after sales picked up on Wednesday when the CBOT rallied.
Farmers were wrapping up their corn harvest, but wet weather in the eastern Midwest continued to disrupt progress, dealers said. The products were mixed, with soyaoil gaining on soyameal amid strong crude oil prices. Soya biodiesel production is expanding, increasing the use of soyabean oil as a fuel, rather than as a food.
CBOT December soyaoil closed 0.01 cent lower at 27.71 cents, after spending most of the session higher. The back months were mixed down 0.07 cent to up 0.01 cent.
December soyameal closed $2.70 per ton higher at $198.30, with the deferreds down $2.50 to $3. Commodity funds sold about 3,000 soyabeans, 2,000 soyameal and were even to net buyers in soyaoil.
Commercials were also featured buying soyaoil, traders said. Export sales data were supportive for soyameal and disappointing for soyaoil, traders said. USDA reported US soyameal export sales last week were 265,900 tonnes, above estimates for 75,000 to 125,000 tonnes. US soyaoil export sales were a negative 100 tonnes as South Korea cancelled a purchase of 500 tonnes.
That compared with trade estimates for exports of 3,000 to 7,000 tonnes. The government trimmed its 2006/07 US soyaoil end stocks estimate in this month's supply and demand report and kept soyameal stocks unchanged. Malaysian palm oil futures closed higher.