US soyabean prices rose to a three-year high on Monday as worries that late-maturing soyabeans in the upper Midwest were damaged by a weekend freeze, traders said. "The freeze in the upper Midwest was a bit of a bullish surprise," said Mario Ballet, analyst with Citicorp.
The two coldest spots in the Midwest crop belt were north-central Iowa near Mason City and south-western Minnesota near Redwood Falls where the lows on Saturday dipped to 28 degrees Fahrenheit (minus 2 Celsius). Elsewhere in the western belt, weekend lows were in the low to mid 30s F (minus 1 to plus 1.6 C), a private forecaster said.
The freeze or light frost was about two to three weeks early for the northern crop belt and it was uncertain if there was much damage to soyabeans as the crop was ahead of normal development, the forecaster said. "Beans were influenced by the cold weather. There's a real mix of ideas on how much damage was done some forecasters are saying the damage was minimal and others are saying it was significant in the western belt," one CBOT trader said.
Another Chicago trader said: "Even if there wasn't much damage, it's the perception that gets the market going." Those views rallied the Chicago Board of Trade soya markets overnight and they remained strong on Monday. Bellwether November soyabean futures closed 13-3/4 cents per bushel higher at $9.68-1/2, after touching a contract high $9.74-3/4 the highest price for a spot contract in three years. The Chicago soyaoil market was also strong, soaring to a 23-year high of 39.95 cents per lb. in the spot October contract overnight.
October soyaoil ended 0.20 cent firmer at 39.72 cents. "Crude oil is firmer and the freeze will have people talking about lower (soya) oil yields," Ballot added. The potential for lower soyaoil production helped lift soyaoil prices, especially after the government last week cut its US soyaoil ending stocks forecast by 490 million lbs. for the market year beginning October 1 to reflect a jump in consumption by the biofuels industry to produce soya bodiless, traders said. Chicago soyameal prices also soared, actually gaining on soyaoil a reverse of last week's trend when oil gained on meal.