Soyabean futures at the Chicago Board of Trade soared on Friday to a 34-year high in a spot contract amid spillover buying from soyameal, traders said. January soyabeans ended 21 cents higher at $11.19-3/4 a bushel after rising to $11.22 the highest price for a spot contract since the summer of 1973 while the back months notched contract highs.
"It's all meal-driven and the speculative buyers have jumped in," one CBOT trader said. Soyameal has been on a roll all week, rising above $300 a ton, supported by strong global demand for feed. "Meal consumption remains very firm," said analyst Roy Huckabay of the Linn Group. "We are taking poultry production up dramatically.
Our chick replacements last week were up 6 percent. Those are big meal-consuming units." Additionally, world feed grains are trading roughly $70 to $90 a tonne higher than US corn, making soyameal an attractive buy to global livestock producers, he added.
Soyameal made contract highs across the board and December meal closed at a three-year top for a spot month of $310.50 a ton, up $10.90.
The backs ended $6.20 to $10.70 firmer. Traders were unwinding long oil/short meal spreads, which helped boost meal further. The strength in soyabeans and meal helped soyaoil turn around, brushing off the negative influence from a drop of $2 a barrel in crude oil.
December soyaoil closed 0.05 cent per lb higher at 45.30 cents a lb. The deferreds ended 0.06 to 0.35 cent firmer. Commodity funds bought 5,000 soyabean contracts, traders said.
Ideas that the US Agriculture Department would trim 13 million bushels off its 2007/08 US soyabean ending stocks estimate putting it at 197 million to reflect a strong crush pace and export business added support. Additional support stemmed from uncertain weather patterns in South American soya areas.
Rains in Brazil maintain favourable crop growing conditions, but less rainfall was predicted for Rio Grande do Sul, DTN Meteorlogix said. Meteorlogix said there was a chance for showers in Argentina, which is dry, but there was uncertainty about the long-range forecast.