US soybean futures ended lower on Friday amid profit taking after rallying early on a forecast for sharply lower production in Argentina. March soy settled 3 cents lower at $10.09 a bushel, after rising to a session high of $10.34. New-crop November tumbled 14-1/4 cents, or 1.5 percent, to $9.43-1/4.
The early rally in soybeans came as the Buenos Aires Grains Exchange forecast 2008-09 soybean output to drop by 17 to 25 percent from 48.02 million tonnes last season. The exchange cut its estimate for Argentina's soy plantings to 17.9 million hectares from 18.2 million, citing a drought.
Traders said selling emerged late in the session on speculation that there could be more rain on Monday in Argentina than forecast on Friday. There are some who feel forecasters will change their minds this weekend and add more rain for Argentina,' said analyst Rich Nelson of Allendale Inc. He said July-November spreading weakened the first new crop month of November, adding that traders were expecting farmers to plant a significant amount of soybeans in spring.
Forecasts on Friday said hot and dry weather was stressing crops in Argentina and showers over the weekend may not be enough to prevent further deterioration of crops. Good crop weather continues in Brazil. February options trade active before expiration at the close. Option traders not expecting firms to exercise $10.10 options over the weekend even though March soy settled at $10.09.
USDA said export sales last week totalled 1,329,000 tonnes (old-crop-new-crop), above estimates for 750,000 to 950,000 tonnes. Separately, USDA said exporters reported the sale of 145,000 tonnes US soybeans to China for 2008-09 delivery.
US cash soy steady to lower in the Midwest on Friday afternoon, with the early rally in CBOT futures triggering an increase in farmer selling. Soymeal futures ended lower, but the market remained underpinned by the drought in Argentina, the world's largest soymeal exporter. USDA said soymeal export sales last week totalled 210,700 tonnes (old crop), above estimates for 75,000 to 150,000 tonnes.