Chicago | Reuters –– U.S. soybean futures climbed to a five-week high on Monday, in buying fueled by steep gains in soymeal as dry weather in Argentina threatened to cut yields, traders said.
CBOT March soybean futures rose for the sixth straight session, settling up seven cents or 0.6 per cent at $9.84-1/4 per bushel while CBOT March soymeal was up $7, or two per cent, to $338.60 per ton (all figures US$).
“The soybean market responded (to dryness in Argentina) by adding to the weather premium in prices,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.
“The weather premium is now large enough to have lifted Chicago March soybeans out of their range for the past month.”
Weeks of dry weather and extended forecasts for only light precipitation in Argentina, the top global exporter of soymeal and soyoil, continued to buoy prices. A weather consultant for the Buenos Aires Grains Exchange said the pattern likely will result in yield losses.
“The soybean market is a soybean meal-led rally… (Argentina’s) production estimates are on the decline, so I think that is a bit supportive,” said Don Roose, president of U.S. Commodities.
Abundant global grain supplies continued to anchor corn and wheat prices, which moved in relatively narrow ranges.
CBOT March corn finished down 1/2 cent at $3.52 per bushel, edging lower on technical selling after earlier failing to surpass its Jan. 3 peak of $3.54-3/4.
CBOT March wheat was three cents higher at $4.25-3/4 per bushel, firming on short-covering.
Investment funds were net buyers of soybean, soymeal and wheat futures and sellers of corn and soyoil futures, trader said.
— Michael Hirtzer reports on commodity markets for Reuters from Chicago; additional reporting by Julie Ingwersen in Chicago, Naveen Thukral in Singapore and Gus Trompiz in Paris.