February 18, 2005

US soy prices may rebound with dry spell in South America

US soybean markets continue to keep an eye on the weather in South American weather, which remains dry in major crop-producing regions. Crops in southern Brazil are at the critical pod-filling stage and exposed to yield losses.

Weather forecasters have also dismissed prospects for rain in Argentine growing areas and Rio Grande do Sul of Brazil, with the dry spell expected to hold for the next five to seven days.

Confidence for rain coming next week remains. Markets are on the lookout for rain next week as that will determine how big this year's Brazilian soy harvest crop will be.

The pushback on rain chances in South America firmed soybean futures at mid-day at the Chicago Board of Trade. Late morning, March soybeans were 6 cents higher at US$5.41 a bushel.