Soybeans up 3rd straight day, wheat near 4-1/2-month top

March 19th, 2014

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Category: Grains, Oilseeds

(Reuters) – U.S. soybeans rose for a third consecutive session on Wednesday, with strong demand for domestic crushing and exports set to tighten inventories.

Wheat built on Tuesday’s 2.7 percent gain on concerns about the U.S. winter crop which is facing rough growing conditions.

Chicago Board Of Trade May soybeans climbed 1.2 percent to $14.35-1/2 a bushel by 0250 GMT, the highest since March 10.

May wheat gained 0.4 percent to $6.95 a bushel, inching close to last week’s four-and-a-half-month high of $6.96-1/2 a bushel and May corn gained 0.6 percent to $4.89-1/4 a bushel.

“Firm crush margins are helping support soybean prices as it points towards an increase in demand of U.S. soybeans,” said Vanessa Tan, investment analyst at Phillip Futures in Singapore.

“Strong export demand is helping to lift soybeans as well.”

The National Oilseed Processors Association said on Monday its U.S. members crushed 141.612 million bushels of soybeans in February, slightly above the 140.9 million consensus in a Reuters poll.

Total U.S. soybean export commitments as of March 6 were 106 percent of the projected target for the crop year that ends on Aug. 31, above the five-year average of 91 percent, according to the U.S. Department of Agriculture (USDA) data.

The USDA, in a quarterly report due on March 31, will likely report that despite a larger U.S. harvest, domestic soybean stocks at the beginning of the month were as tight as they were a year ago, said Jerry Gidel, chief feed grains analyst for Rice Dairy.

Gidel estimated March 1 stocks at 1 billion bushels, compared to 999 million the previous year, due to strong demand.

The wheat market is being underpinned by deterioration in the condition of the U.S. winter crop, which is suffering from adverse weather.

The USDA’s weekly state crop reports on Monday showed declining wheat ratings in Kansas, Oklahoma and Texas amid dry conditions.

In Kansas, the top U.S. hard-red winter wheat state, 34 percent of the crop was rated in good to excellent condition, down from 37 percent a week earlier, according to the USDA’s National Agricultural Statistics Service.

In addition, demand for U.S. wheat at current prices supported the market. Egypt, the world’s biggest importer of the grain, said it bought 175,000 tonnes of U.S., Russian and Romanian wheat in a tender.

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