US soyabean futures rallied for the second day in a row o n M onday, hitting a seven-month high on follow-through buying from a government report that pegged lower-than-expected soyabean acreage this year, traders said. The soyabean market has gained 4.8 percent over the past two trading sessions after the US Agriculture Department's prospective plantings report early Friday raised concerns about the possibility of tight soyabean supplies during the next year.
Corn futures also rose, with the buying in old-crop months out pacing new-crop contracts due to fears that exporters, ethanol refiners and livestock producers will struggle to find supplies in the next few months. Expectations that farmers will plant a huge number of corn acres this spring limited the gains in new-crop futures. "The bull numbers from the report were old corn and new beans and that is what is leading us," said Chad Henderson, grain market advisor with Prime Agricultural Consultants.
The expected drop in US soyabean acreage comes after hot and dry weather in South America curtailed harvest from key production areas. "You not only have a compromised crop out of Argentina to deal with but all of a sudden you are talking about these acres being down (in the United States)," said Jason Britt, analyst with Central States Commodities. "You are not really growing these carryouts. There is just not much room for error here."
CBOT May soyabeans settled up 18 cents at $14.21 a bushel. Prices peaked at $14.33 a bushel, their highest level since hitting $14.41-3/4 a bushel on September 2, 2011. New-crop November soyabeans rose 27-1/4 cents to $13.85-1/4 a bushel.
CBOT May corn was up 11 cents at $6.55 a bushel while the new crop December contract was 4-3/4 cents higher at $5.45 a bushel. May corn hit its highest level in nearly two weeks. CBOT May wheat fell 3-3/4 cents at $6.57 a bushel. "You have got a tale of two crops now on corn," said Dewey Strickler, president of AgWatch Market Advisors. "You have got one with tight stocks, with the old crop, and one with what looks like an abundance of stocks with the new crop." Good weather for crop development in key growing areas of the US Midwest boosted prospects for a robust harvest adding to already plentiful wheat supplies.