Soyabean futures at the Chicago Board of Trade climbed on Tuesday, trying to keep pace with the rally in corn given the ongoing fight for US acreage next spring, traders said. "Corn was the catalyst for the strength in the beans. It got people talking about the need to remain competitive for acres," said Mario Balletto, Citigroup analyst.
The battle for acreage will continue all year, traders said. US soya acreage needs to expand by 7 million to 9 million acres next spring from the 64 million acres planted in this year to meet 2008/09 demand.
January soyabeans closed 12-3/4 cents per bushel higher at $10.91-1/2 per bushel. The back months were up 5 to 21 cents, with new-crop November up 17-3/4 at $10.33-1/4. CBOT corn closed 5-3/4 to 8 cents higher amid strong export demand and prospects for corn usage by the ethanol industry to expand given recent government proposals to increase green fuel mandates.
Projections for a smaller-than-expected Brazilian soya crop were supportive as the grain industry hoped South America would take up the slack from the shortened 2007 US output.
Consulting company Celeres forecast Brazil's 2007/08-soya crop at 62.27 million tonnes, a record high but down from the firm's November outlook for 63.1 million. Analyst Oil World, based in Hamburg, on Tuesday said Brazil's soya crop was likely to be smaller than previously hoped because farmers were having problems with plantings.
Oil World also said China was likely to increase imports of soyaoil and soyameal to help cool rising domestic prices. There were concerns that Argentina was turning dry as the young crop is in the midst of emerging. But the country was seeing a little more rain this week. From 0.2 to 0.6 inch of rain fell in the past day, with 50 to 60 percent coverage, said DTN Meteorlogix.
Additional showers of 0.25 to 0.75 inch were forecast for Tuesday. Soyameal gained on soyaoil amid meal/oil spreading, and soyaoil was under pressure from the weakness in crude oil a market it tracks given the expanding biodiesel industry.
Meal was technically strong after breaking through its 10-day moving average on Monday. December meal closed $5.40 per ton higher at $295.50 per ton; deferreds were up $2.00 to $6.00 per ton. December soyaoil rebounded from its early weakness lifted by the strength in soyabeans to end up 0.08 cent per lb at 45.50 cents; back months were up 0.01 to 0.37 cent.
Commodity funds bought at least 4,000 lots of soya amid talk of new interest by hedged and index funds, traders said. Malaysian palm oil futures closed lower. Midwest basis bids for soya were steady to firm, supported by lack of country movement, traders said.
Overnight, there was another round of heavy December product deliveries. There were 561 soyameal deliveries but strong stoppers met them. The ADM house account took 268 while a Man customer stopped 130. In soyaoil, there were 1,664 deliveries, which were met by a strong stopper. A customer of Man took 783 lots.