Soybeans Gain as Crop Conditions Deteriorate on Dry, Hot Weather

September 17th, 2013

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Category: Grains, Oilseeds

(Bloomberg) – Soybeans rose in Chicago, rebounding from the biggest drop in more than a week, after a report showed U.S. crop conditions are worsening.

Fifty percent of soybeans in the main growing areas were in good or excellent condition as of Sept. 15, down from 52 percent a week earlier, the U.S. Department of Agriculture said in a report yesterday. The oilseed advanced for six straight weeks through Sept. 13 as unusually dry, hot weather across the Midwest raised concern yields will be less than forecast. The USDA cut its production forecast on Sept. 12 to 3.149 billion bushels from 3.255 billion estimated in August.

“There was deterioration in crop conditions for soybeans because the hot and dry conditions in August affected the crop significantly and adversely affected yields,” said Joyce Liu, an analyst at Phillip Futures Pte in Singapore. “It would be difficult for rainfall to help replenish the moisture needed to improve soybean yields.”

Soybeans for delivery in November climbed 1 percent to $13.62 a bushel at 6:59 a.m. on the Chicago Board of Trade. Prices fell 2.4 percent yesterday, the most since Sept. 4, on speculation rains in the Midwest would aid crop conditions.

Parts of Iowa, Illinois and Missouri had less than 25 percent of normal rainfall in the past 30 days, even as some areas saw 0.5 inch (1.3 centimeters) of rain yesterday, National Weather Service data show. Some parts of the Midwest may see scattered showers this week, and there’s no crop-damaging freeze in the forecast, DTN said in a report today.

Insurance Claims

Futures also rose as a USDA Farm Service Agency report today showed farmers filed more crop-insurance claims than last year after excess rain this season prevented planting. Claims covered 1.69 million acres of soybeans as of Sept. 1, up from 1.62 million reported in August and 159,579 acres last year, the FSA said. Claims were filed on 3.57 million acres of corn, up from 3.41 million in August and 2012’s total of 262,467 acres.

Corn for delivery in December rose 1.9 percent to $4.65 a bushel. An estimated 53 percent of the crop was in good or excellent condition as of Sept. 15, down from 54 percent a week ago that got the top ratings, the USDA report showed.

Wheat for delivery in December gained 1.1 percent to $6.48 a bushel. Milling wheat for delivery in November added 0.4 percent to 185.75 euros ($248.05) a metric ton on NYSE Liffe in Paris.

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