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DOW JONES NEWSWIRES
Soybean futures on the Chicago Board of Trade rose slightly after fund-led
short-covering took prices off their lows and placed them onto positive ground
in the final 45 minutes of the session, sources said.
Forecasts for drier weather in southern Brazil and Argentina helped spark the
gains, an analyst said.
Most-active May soybeans gained 3 cents to $5.99 and March beans rose 3 3/4
cents to $5.87. May soymeal gained 10 cents to $184.40 a short ton and May
soyoil rose 24 points to 22.67 cents a pound.
"The weather in (southern) Brazil at noon went slightly drier, and it looks
like the next best chance of rain in Argentina is more in the seven to 10-day
range," said Don Roose, president of U.S. Commodities in West Des Moines, Iowa.
Conditions begin to turn dry in southern Brazil and worsen further southotni
Argentina.
Recent rains in Argentina have been beneficial for the crop, the Agriculture
Secretariat there said, estimating the soybean crop at 38.5 million to 40
million tons. If the crop receives adequate rain, production will match the
estimate, it said.
But additional moisture may be slowing in coming, according to forecasts.
Hot, dry weather with readings in the 90s and 100s Fahrenheit will stress the
Argentine soybean crop and that weather pattern will remain in place through
the middle of next week, weather service DTN Meteorlogix said.
Brazil's Parana province has a shot at rain on Friday, with up to 1 inch
possible, while Rio Grande do Sul will see just scattered showers and no more
than 0.50 inch of rain before the end of the week, DTN Meteorlogix said.
Early pressure in the soybean market that drove May futures down to a $5.71
session low and the weakest price since Jan. 26, was due to index-fund-related
selling and talk that the U.S. Department of Agriculture may raise 2006-07 U.S.
soybean ending stocks above 600 million bushels at its annual Outlook Forum
that begins Thursday, traders and analysts said.
The ability of the market to rebound and close higher was encouraging for
market bulls, however, and may help set up a steady to firmer opening on
Thursday. Weekly export sales also will determine the market's action and most
traders and analysts look for soybean sales in the 400,000-600,000 metric-ton
range, compared to 562,300 tons the previous week.
At the CBOT, ABN Amro sold 1,000 Mar and 800 May, Calyon Financial sold 1,000
Mar, JP Morgan sold 600 May and 200 Nov, Fimat sold 500 May and 200 Mar, Man
Financial sold 400 May and 500 Mar, O'Connor and Rand Financial each sold 500
May, Refco sold 500 Mar and UBS sold 400 Mar and a net 400 May.
ADM bought 1,000 Mar to lead the buyers.
Fimat spread 1,100 May/Mar at 12 3/4 cents. Shatkin Arbon spread 1,000 at 12
1/4 and Iowa Grain spread 600 at 12 1/2 cents.
Funds sold an estimated 8,700 contracts on the day, but that didn't account
for the late price rally.
SOY PRODUCTS
The product markets closed steady to mixed as those prices also came off
their lows along with the late rally in soybeans.
May soymeal finished with a slight gain on short-covering, after touching a
one-week low of $179.00 earlier in the session. The contract settled at $184.40
a ton.
Fimat was the largest buyer of meal at 300 May and 200 Mar contracts, with
CIS and Calyon each selling 200 Mar.
May soyoil finished the day in the black and the buying in beans and meal
spilled overotnithe oil pit and boosted the market. May bounced off a
two-week low at 22.15 and rallied up to 22.98 before settling at 22.67 cents.
Bunge bought 300 May and 400 Mar oil, Citigroup bought 200 May and 300 Mar,
Fimat bought 200 May, Goldenberg-Hehmeyer bought 300 Mar, and Rosenthal and
Tenco each bought 200 Mar.
CIS sold 400 Mar, Man Financial sold 300 Mar and 200 May, R.J. O'Brien and
Kottke each sold 300 Mar, while O'Connor and Prudential each sold 200 Mar.
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