June 22, 2010

US soy futures may rally highest in two weeks

Soy futures may rally to US$10 a bushel within the next two weeks on short-term tightness and speculative covering, Scott Briggs, according to analysts.

The November-delivery contract was unchanged at US$9.39 a bushel at 11:07 a.m. in Singapore after rallying in the past four days. Soy futures have fallen 10% in 2010.

Meanwhile, Chicago wheat fell a third day, with the September contract trading at US$4.7475 a bushel, after rallying 12% from June 9-17.

Investors should buy November EU mill wheat and sell December Chicago wheat futures as a hedge, "to provide significant upside with limited risk," analysts said.

EU mill wheat traded at EUR153.50 (US$189) a tonne, or US$4.18 a bushel earlier, while Chicago wheat for December delivery traded at US$5.0475 a bushel at 10:50 a.m. Singapore time.

Corn, wheat and soy are the top three crops in the US.