February 21, 2014
US soyabeans futures firmed on Thursday, erasing losses made in the overnight trading session, on support from a government forecast for acreage expansion that came in below market expectations, traders said. Gains in the new-crop contracts outstripped old-crop offerings due to the plantings outlook.
“While increased acres will have near-term bearish effect, they were below expectations, and the market may be able to shrug off bearishness readily particularly on the front end,” Sterling Smith, futures specialist at Citigroup, said in a note to clients. Corn prices also generated strength from the acreage view while wheat prices fell on profit taking following a four-day rally that pushed prices to their highest in two months.
The US Agriculture Department pegged 2014/15 US soyabean acreage at a record 79.5 million, 3 million acres above expectations but below market forecasts. At 10:00 am CST (1600 GMT), Chicago Board of Trade soyabeans for March delivery were up 4-3/4 cents at $13.59 a bushel. New-crop November soyabeans were 7-1/4 cents higher at $11.44-1/4 a bushel.
Concerns about weather in Brazil, where dry conditions were limiting crop production in north-eastern states while rainy weather in other areas were slowing harvest, added further support to soyabeans. “The unfavourable weather in western Brazil … is delaying both harvesting and actual shipments of beans to the ports,” Futures International analyst Terry Reilly said.
CBOT March corn futures were 1/2 cent higher at $4.54-1/4 a bushel. The new-crop December contract gained 1/2 cent to $4.68-3/4 a bushel. USDA said it expected corn acreage to decline to 92.0 million acres as part of a 0.7 percent reduction in the space US farmers will devote to the eight major field crops this year. Short-covering also supported corn prices and helped mitigate pressure from weakness in the wheat market.
CBOT March wheat fell 5 cents to $6.15-1/4 a bushel, on track for its first losing session since February 12. Concerns about a return to cold weather in the US Midwest next week following a warm-up that melted much of the snow protecting the crop from winterkill limited declines. But some forecasters said temperatures will not drop far enough to damage the crop and more snow was in the forecast for much of the region during the next week. Reuters