May 26, 2016 / 3:32 AM / a year ago

GRAINS-Soybeans hit 2-week high on Argentina supply woes, wheat rises

* Soybeans mark 2-week top, soymeal at 18-month peak
    * Argentina crop concerns lift prices, speculators long in
meal
    * Wheat gains for third day as rain forecast in U.S.

 (Adds comment, detail)
    By Naveen Thukral
    SINGAPORE, May 26 (Reuters) - U.S. soybeans hit their
highest in two weeks on Thursday and soymeal jumped to an
18-month peak, with prices underpinned by concerns over lower
supplies from key exporter Argentina. 
    Wheat gained more ground as the market was supported by
unseasonal rains causing potential damage to the maturing U.S.
winter wheat crop, while corn traded at its highest in more than
a month.
    The Chicago Board of Trade most-active soybean contract
 rose as much as 0.3 percent to $10.88-1/4 a bushel, its
highest since May 12. Soybeans, which rallied almost 3 percent
in the last session, were trading down 0.1 percent by 0241 GMT.
    Soymeal added as much as 0.9 percent to $410.9 a
short ton, the strongest since November 2016. The market climbed
4.7 percent in the last session.
    "The main concern driving soybean and meal prices higher is
the damage to crops in Argentina, but speculative length has
increased significantly in recent months," said Pawan Kumar, a
director of agricultural commodities research at Rabobank in
Singapore.
    "Non commercials continue to extend their net long position
across CBOT soymeal, reaching a 9-month high. We expect the U.S.
soybean crop to be larger than (had been) expected and as a
result meal futures will retreat."
    Commodity funds were net buyers of CBOT soybean, corn and
wheat contracts on Wednesday.
    Trader estimates of net fund buying in soybeans ranged from
10,000 to 16,000 contracts. Estimates of net fund buying in corn
were from 8,000 to 16,000 contracts and in soymeal from 7,000 to
10,000 contracts.
    In April, there was flooding in key farm areas in Argentina,
the world's third-largest exporter of unprocessed soybeans and
its biggest shipper of soymeal. 
    Flooding is expected to have cut the country's soybean
output by 4 million to 8 million tonnes, even as
higher-than-expected yields in dryer areas offset some of the
losses, local farm analysts said on Wednesday.
    The country's soybean exports could fall by as much as 25
percent this year. 
    Wheat is drawing support on concerns over forecasts of rains
in the U.S. Plains which could damage the hard red winter wheat
crop.
    Wheat rose 0.2 percent to $4.67 a bushel, while corn
 slid 0.1 percent to $4.04-1/4 a bushel. Corn climbed
earlier in the session to $4.05 a bushel, matching Wednesday's
price which was the highest since April 21. 
    
 Grains prices at  0241 GMT
 Contract    Last     Change   Pct chg  Two-day chg  MA 30    RSI
 CBOT wheat  467.00   1.00     +0.21%   +1.08%       475.49   52
 CBOT corn   404.25   -0.50    -0.12%   +1.76%       387.06   67
 CBOT soy    1084.00  -1.50    -0.14%   +2.48%       1036.38  65
 CBOT rice   11.31    $0.08    +0.67%   -2.67%       $11.31   43
 WTI crude   49.84    $0.28    +0.56%   +3.66%       $44.86   81
 Currencies                                                   
 Euro/dlr    $1.117   -$0.005  -0.43%   -0.25%                
 USD/AUD     0.7208   -0.001   -0.15%   -0.24%                
 Most active contracts
 Wheat, corn and soy US cents/bushel. Rice: USD per
 hundredweight
 RSI 14, exponential
 
 (Reporting by Naveen Thukral; Editing by Joseph Radford)

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