Soybeans Climb to One-Week High as U.S. Reserves Seen Declining

March 27th, 2014

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Category: Grains, Oilseeds

(BusinessWeek) – Soybeans advanced for a fourth day to the highest level in a week on speculation that inventories in the U.S., the largest grower, have decreased as exports rose.

The contract for May delivery climbed as much as 0.3 percent to $14.445 a bushel on the Chicago Board of Trade, the highest since March 20. Futures were at $14.43 by 12:05 p.m. in Singapore, extending the 2.2 percent advance in the three days through yesterday. Prices jumped 12 percent this year.

Stockpiles on March 1 probably dropped to 987 million bushels (26.9 million metric tons), the smallest for this time of year in a decade, according to the average of 30 analyst estimates compiled by Bloomberg. Reserves will be equal to 30 percent of estimated annual use and exports of 3.319 billion bushels, the lowest ratio for this time of year since at least 1965, U.S. Department of Agriculture data show. The agency will update its quarterly crop-inventory estimates on March 31.

“Soybeans continue to be supported over concerns of tightening U.S. supplies and robust export demand,” Vanessa Tan, an analyst at Phillip Futures Pte in Singapore, said in a report today.

Since Sept. 1, shipments of U.S. soybeans jumped to 39.7 million tons, up 22 percent from a year earlier and almost reaching the government forecast for 41.64 million tons for the entire 12 months ending Aug. 31, according to the USDA.

Wheat for May delivery was unchanged at $6.9675 a bushel in Chicago. Corn fell for a third day, dropping 0.2 percent to $4.835 a bushel.

There may be less demand for corn as ethanol inventories expanded in the U.S., Tan said.

Total stockpiles were at 15.7 million barrels in the week ended March 21, up 2.5 percent from a week earlier, showed data from the Energy Information Administration, statistical arm of the Energy Department.

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