June 10, 2010

 

US soy futures dip on bigger-than-expected production in Brazil

 

 

Soy futures fell in Chicago on concern output from Brazil, the second-largest exporter; will grow faster than expected, stoking competition among suppliers.

 

Futures for July delivery declined for a third time in four sessions, losing 0.3% to US$9.2825 a bushel on the CBOT at 2:18 p.m. Singapore time.

 

Farmers in Brazil, the biggest shipper after the US, will harvest 68.7 million tonnes of soy this year, more than a May 6 estimate of 67.9 million tonnes and more than last year's output of 57.2 million tonnes, the Agriculture Ministry's crop-forecasting agency Conab said earlier.

 

Soy production in China, the world's biggest importer, may drop 3.3% to 14.5 million tonnes in the year from October 1, the China National Grain & Oils Information Center said.

 

Meanwhile, corn for July delivery was little changed at US$3.37 a bushel after trading between US$3.365 and US$3.385.

 

Additionally, analysts said that higher crude oil prices and a weaker dollar may help boost the appeal of US crop supplies to importers and investors.

 

The Dollar Index, which tracks the value of the greenback against six major currencies including the yen and the euro, declined for a second day, dropping 0.3%.

 

July-delivery crude advanced 1% to US$72.73 a barrel in New York as confidence among US small businesses grew and an industry report showed a drop in the country's crude supplies, boosting optimism that demand may expand.

 

July-delivery wheat added 0.4% to US$4.3375 a bushel. South Korea's Major Feedmill Group bought 110,000 tonnes of wheat through a private negotiation earlier, according to industry executives who took part in the transaction.

 

CJ CheilJedang Corp., South Korea's biggest food processor, and Dongah Flour Mills Co. jointly bought 23,300 tonnes of milling wheat for shipment between August 15 and September 15 in a tender on Tuesday (June 8), said two industry officials who participated in the bidding.