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CBOT soya ends at 4-week highs on weather jitters

CHICAGO: Soyabean futures at the Chicago Board of Trade jumped to four-week highs Wednesday, as dry conditions in parts of the South American soyabean belt kept traders on edge over potential crop problems.

Soyabeans settled unchanged to 6-1/4 cents per bushel higher, with March up 5-1/2 at $4.77, the contract's highest close since $4.79-1/2 on Dec. 8. Commodity funds were prominent buyers, and were estimated to have bought at least 1,500 soyabean contracts on the day, traders said.

Brazil's northern soyabean belt was in good condition and was expected to receive widespread rain over the next seven days, but forecasters continued to project only limited rainfall chances for the drier southern half, particularly the state of Rio Grande do Sul.

Crops in southern Brazil and in some of Argentina's corn and soyabean belt have suffered from below-normal moisture since planting began in mid-October.

"The bottom line is that far southern Brazil, especially the acreage in Rio Grande do Sul, needs more rain," Salomon Smith Barney Inc.'s weather report said Wednesday. "Since the far southern belt will be warm and dry during the next week, soil moisture reserves will be decreasing across the belt.

Brazil and Argentina are the world's second- and third-leading soyabean producing nations behind the United States.

The South American crop was still in its early stages and could benefit from timely rains, but CBOT traders were adding a "weather premium" into soyabeans to take into account possible weather-related shortfalls, traders and analysts said.

"It reflects a little angst on the moisture situation," said Robert Lekberg, grain and oilseed analyst for Goldenberg Hehmeyer & Co. in Chicago.

Technicals were also stronger in the wake of gains the past two sessions, Lekberg said, prompting fund buying interest.

March soyabeans have now moved above several major chart moving averages, including the 50-day, roughly $4.75-3/4 at Wednesday's close. The 100-day moving average was about $4.90 at the close.

Up to the last 45 minutes of trading, Salomon Smith Barney bought 600 March contracts, Merrill Lynch and Refco each bought 300 March, Cargill Inc. sold 300 July and FIMAT Futures Inc. sold 300 March and 400 July, pit sources said.

In spreading, ADM Investor Services bought 500 January and sold 500 March at a price differential of 8 to 7-3/4 cents and Term Commodities bought 400 January and sold 400 March at 8 cents.

Soyabean futures volume during Wednesday's pit session was estimated by the CBOT at 45,000 contracts, compared to 45,077 Tuesday.

CBOT wheat ends higher on fund buying, US weather

CHICAGO: Soft red winter wheat futures at the Chicago Board of Trade ended higher on Wednesday on buying by commodity funds and continued concern over weather in the US Plains, traders said.

CBOT wheat settled 1 to 5 cents per bushel higher, with March up 2-1/2 at $2.49-3/4, matching its close on Dec. 23.

Funds bought 1,000 contracts. Higher soyabean futures fuelled by fund buying and concerns over dry conditions in Brazil and Argentina also fuelled the wheat market.

Prospects of warmer, drier weather in the Plains winter wheat region raised some concerns although meteorologists said the condition would not break the crop's dormancy.

"Wheat was following beans," said Kansas-based analyst Sid Love of Joe Kropf and Sid Love Consulting.

Weather Services Corp. senior agricultural meteorologist Joel Burgio said Wednesday warmer and mostly dry conditions will return to the Plains later this week.

But the weather will not be warm long enough to break the dormancy of the wheat crop, he said. The warmer weather will come on the heels of snow that fell early this week in Kansas.

Meanwhile, Salomon Smith Barney said in its daily weather report that there was a possibility of winterkill on Thursday and/or Friday across some pockets of the northern portion of China's central winter wheat belt due to an Arctic air mass.

It said low temperatures on the coldest mornings will be down to near zero degree Fahrenheit across the northern portion of the belt, with lows in the single digits and teens Fahrenheit across the central and southern portions.

The report said that any winterkill damage due to the air mass would not be fully known until the crop comes out of dormancy and begins spring growth in March and early April.

China's Agriculture Minister Chen Yaobang was quoted by state media as saying on Wednesday that the country was targeting grain production at 490 million tonnes for 2000, down from 500 million in 1999.

The market remained under the cloud of sluggish exports. Australia on Tuesday beat out the United States in Pakistan's tender for 500,000 tonnes of soft white wheat, highlighting the stiff competition the United States faces in the export market. Australia's national wheat exporter AWB Ltd said on Wednesday that it might export a further 500,000 tonnes of wheat to Pakistan before the end of June. FCC Futures bought 300 March contracts, O'Connor & Co bought 500 March, R.J. O'Brien bought 500 March, Salomon Smith Barney sold 200 March, FIMAT Futures sold 300 March.

CBOT wheat futures volume was estimated by the CBOT at 20,000 lots, compared with 24,385 traded on Tuesday.

Wheat options volume was estimated at 2,500.

CBOT corn ends higher on soyabean, wheat strength

CHICAGO: Corn futures at the Chicago Board of Trade ended mostly higher on Wednesday, riding on the coattails of soyabeans and wheat.

CBOT corn settled steady to 3/4 cents per bushel higher, with March steady at $2.03.

"Corn was following beans and wheat," said analyst Sid Love of Joe Kropf and Sid Love Consulting.

Corn futures spent most of the day in negative territory but turned higher amid a spurt of late short covering, and as soyabean and wheat futures gathered strength.

Soyabeans played the role of market leader, with commodity funds buying 1,500 contracts and support also coming from concerns over dry weather in Brazil and Argentina, the world's second and third largest producers after the United States.

Wheat was buoyed by fund buying and concerns over warmer and drier weather in the US Plains winter wheat belt.

Corn futures were pressured early in the session by news that a South Korean entity had passed on a tender for 105,000 tonnes of Argentine or US corn because of high prices.

The move highlighted the abundant world corn supply, a situation in which buyers are calling the shots.

US corn exports for the 1999/2000 marketing year were estimated at 1.925 billion bushels, according to the US Department of Agriculture, down 3 percent from 1998/99.

Some of the early weakness was also attributed to an increase in US farmer selling of corn late on Tuesday, that led to an increase in hedging early in the session.

"There was some selling in the market because of corn movement (in the cash markets)," said analyst Love.

Corn futures were underpinned by uncertainty over the weather outlook for South America's corn and soyabean belts.

Weather Services Corp. on Wednesday said drier and hotter weather continued to cover the key corn areas of central Argentina, stressing some of the crop.

It said drought conditions in October and November in some major growing areas of Brazil will impact production, but added that weekend showers will ease stress to the crop after last week's drier and warmer weather.

Argentina is a major corn producer and exporter.

Commodity funds sold 300 contracts. Refco Inc. bought 600 March, 100 July contracts, Lee B. Stern bought 500 March, Merrill Lynch sold 1,000 March, Carr Futures sold 300 March, FCC Futures sold 400 March, 100 July.

Corn futures volume was estimated by the CBOT at 40,000 lots, compared to the 48,748 lots traded Tuesday.

Corn options volume was estimated at 15,000 lots.

CBOT soyameal hits two-month high, soyaoil higher

CHICAGO: Weather uncertainty surrounding South America's soyabean crop kept the Chicago Board of Trade soya complex moving higher Wednesday, with soyameal futures surging to their highest levels in two months.

Soyameal settled $2.50 to $4.20 per ton higher, with March up $3.20 at $151.80, the contract's highest close since $152.80 on Nov. 5.

The soyaoil pit shook off early-session weakness and joined in a late surge across the soya complex, lifted by commodity fund buying, traders said. Prices settled 0.09 to 0.17 cent per lb higher, with March up 0.14 at 15.96 cents.

Traders estimated that funds bought at least 800 meal contracts and 1,200 soyaoil contracts on the day.

Conditions in southern Brazil remained generally dry, stressing soyabean acreage and raising concerns over the potential for production shortfalls. Much of Argentina's corn and soyabean areas also needed rain, meteorologists said.

The South American crop was nearing its critical reproductive stages, which typically take place in January and February. Gains in the CBOT soya complex reflected a desire to add a "weather premium" to take account for possible weather problems ahead, traders and analysts said.

"Weather is uncertain," said Robert Lekberg, grain and oilseed analyst for Goldenberg, Hehmeyer & Co. in Chicago. "We already have impaired prospects for corn and soyabeans in South America. They're putting in a little weather premium."

Brazil's northern soyabean belt was in good condition and was expected to receive widespread rain over the next seven days, but forecasters continued to project only limited rainfall chances for the drier southern half, particularly the state of Rio Grande do Sul.

Brazil and Argentina are the world's second- and third-leading soyabean, soyameal and soyaoil producing nations behind the United States.

Lekberg said strength in European meal markets, where prices were up about $2 per ton, also supported CBOT meal futures.

In soyaoil, prices eased initially amid further weakness in prices for Malaysian palm oil, a competitor of US soyaoil for global vegetable oil demand.

Malaysian palm oil futures fell to five-month lows in a continuing reaction to India's decision to raise its import duty on refined edible oils.

Technicals for the soya complex have firmed in the wake of gains the previous two sessions, Lekberg added, stirring fund buying. March meal moved above most major chart moving averages, including the 100-day, roughly $149.60 at Wednesday's close.

Up to the last 45 minutes of trading, O'Connor & Co. bought 600 March meal contracts, Cargill Inc. bought 300 March and 200 May, ADM Investor Services bought 300 March and RJ O'Brien & Associates and TENCO Commercial Grain each sold 300 March, pit sources said.

In soyaoil, Goldenberg, Hehmeyer & Co. bought 500 May and TENCO Commercial Grain and Term Commodities each bought 200 March. In options, FIMAT Futures Inc. sold 1,000 March 17.50 soyaoil puts, floor sources said.

Soyameal futures volume during Wednesday's pit session was estimated by the CBOT at 20,000 contracts, compared to 21,574 Tuesday. Soyaoil volume was estimated at 20,000 contracts, compared to 27,215 Tuesday.-Reuters