Forexpros – Soybean futures were up for a third day on Monday, trading at a two-week high as poor weather conditions in Argentina and Brazil fuelled concerns over crop conditions in the South American countries.
On the Chicago Mercantile Exchange, soybean futures for January delivery traded at USD11.4512 a bushel during European morning trade, rallying 1.3%.
It earlier rose by as much as 1.4% to trade at USD11.4538 a bushel, the highest since December 5.
Agricultural commodity traders shrugged off news of the death of long-time North Korean leader Kim Jong il as well as the risk of possible ratings downgrades on euro zone countries, instead focusing on market fundamentals.
Soybean prices have advanced in five of the past six trading sessions, gaining nearly 5% amid ongoing concerns over dry weather conditions in Brazil, the world’s second largest soy exporter.
Industry weather group Telvent DTN said Friday that it expected warm and dry weather conditions to linger across major soybean-growing regions in the southern part of Brazil through December 23.
The industry group added that most parts of Rio Grande do Sul and southern Parana states, which combine to produce nearly 14% of Brazil’s soybeans, have had below normal rainfall so far in December.
Meanwhile, weather service provider MDA Federal offered a similar outlook for Argentina, the world’s third largest soybean exporter.
According to the group’s six-to-ten-day outlook, weather conditions across most parts of Eastern Argentina, the nation’s major soybean-producing area, were forecast to remain dry, with temperatures heating up to the 80s to 90s Fahrenheit (26 to 32 Celsius).
The dry weather conditions were likely to reduce soil moisture, potentially threatening yields and weighing on the quality of the harvest.
South America is the main competition for U.S. exporters and a smaller crop outlook there would likely mean greater demand for U.S. soybeans.
Traders have been focusing on crop prospects in Southern Hemisphere countries in recent sessions, as most Northern Hemisphere corn crops have been harvested by now.
Elsewhere on the Chicago Mercantile Exchange, corn for March delivery surged 1.44% to trade at USD5.9163 a bushel, while wheat for March delivery jumped 1.2% to trade at USD5.9063 a bushel.
Forexpros
