US soy futures ease slightly after strong gains

The front-month US soy futures eased nearly 1 percent on Thursday (July 2) as investors booked profit after strong gains, while new-crop contracts edged higher on lower acreage and weather concerns.

Corn fell half a percent on the bearish impact of a US government report on corn acreage this year that was well above analysts' estimates.

Commodity Warrants Australia analyst Toby Hassall said profit taking might be part of the market ahead of the weekend and that acreage number for the new crop is little lower than previously expected, perhaps providing ongoing support to more distant months.

Soy futures surged 2.5 percent to a 2-A½ week high in the previous session on concerns over tight old-crop supplies which were underscored by fresh Chinese buying.

The US Department of Agriculture (USDA) is forecasting that by September 1, the supply of soy will shrink to 110 million bushels, the smallest stockpile since 1977 and less than a two-week supply.

Chicago Board of Trade (CBOT) soy for July delivery fell 0.9 percent to US$12.47 a bushel, while the new-crop November soy rose half a cent to US$10.16 a bushel.

A forecaster said cool temperatures blanketing the US Midwest are favourable for corn and soy development.

But some outlooks called for a high pressure ridge to move into the US Midwest crop belt late next week, bringing in hotter and drier weather with it.