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CBOT soyameal jumps to 3-month high, soyaoil lower

CHICAGO: Soyameal futures at the Chicago Board of Trade jumped sharply on Friday and ended at the highest prices in nearly three months, lifted by rallying soyabeans and beliefs that expected hotter weather could harm South American soyabean acreage, traders said.

Soyameal settled $1.20 to $4.20 per ton higher, with March up $4.20 at $158.50, the contract's highest close since the same settlement on Oct. 18. January meal contracts expired at 12:01 p.m. CDT, up $1.20 at $155.

Soyaoil lagged the rest of the soya complex and ended lower after rising to near three-week highs early. Prices settled 0.07 to 0.10 cent per lb lower. March ended down 0.09 at 16.32 cents after hitting its highest price since Dec. 27 at 16.53. January soyaoil expired 0.09 lower at 16.03.

Traders said soyameal futures continued to follow the path of soyabeans, which gained at least 6 cents a bushel in most contracts and ended near three-month highs.

"The meal market was very, very strong," said John Janney, a trader with Salomon Smith Barney at the CBOT, noting that commodity funds were again prominent buyers in meal futures. Funds bought an estimated 5,000 contracts in soyameal on the day. "I think they're getting long," Janney said.

Forecasts for 100-degree Fahrenheit temperatures in parts of South America's soyabean belt next week were the catalyst for further gains in soyabeans, traders said.

Salomon Smith Barney meteorologists projected high temperatures from 99 to 105 degrees across southern Brazil Tuesday through Thursday next week, the result of a heat-producing high pressure ridge expected to develop.

Crops in that area, which includes one of Brazil's top soyabean growing states, have already suffered stress from below normal rainfall since the start of planting in October.

The potential for weather-related production shortfalls in South America and a reduced soyabean supply outlook in the U.S. have combined to turn CBOT market sentiment quickly toward a more bullish stance, traders said.

Prospects for lower soyabean availability stirred increased activity in European meal markets, as buyers scrambled to secure coverage. Meal values in Europe were higher Friday, but demand was dampened somewhat by a stronger dollar.

Soyaoil, however, trailed the rest of the soya complex, partly because most of the supply-related concerns focus on meal, traders said.

While the worldwide meal availability may be reduced if dryness cuts South American soyabean production, global supplies of soyaoil and other vegetable oils should remain abundant, thanks in part to large output of Malaysian palm oil.

Up to late trading, Cargill Inc. bought 1,300 March meal contracts, FIMAT Futures bought 1,000 March, Salomon Smith Barney bought 1,000 March, Merrill Lynch bought 700 March and Carr Futures bought 500 March and 500 May, pit sources said.

In soyaoil, ADM Investor Services sold 600 March, FIMAT Futures bought 400 March, Produce Grain bought 500 March, Refco Inc. bought 400 March and Salomon Smith Barney bought 600 May.

Soyameal futures volume in Friday's pit session was estimated by the CBOT at 36,000 contracts, compared with 25,649 Thursday.

Soyaoil futures volumed was estimated at 23,000, compared with 26,249 Thursday.-Reuters