August 10, 2010

US soy futures rise as high Chinese demand eats into supplies

Soy futures rose for the ninth straight session on speculation that Chinese imports will reduce stockpiles in the US, the world's largest producer and exporter.

The US sold 284,000 tonnes to China for delivery after September 1, USDA said earlier. Chinese processors may have bought at least 1.2 million tonnes of US soy last week, the China National Grain & Oils Information Center (CNGOIC) said. Soyoil futures in China, the world's biggest consumer, surged to almost a two-year high.

Soy futures for November delivery rose 5.25 cents, or 0.5%, to US$10.39 a bushel at 10:12 a.m. on the CBOT, after dropping as much as 0.4%. The price gained 7% the prior eight sessions.

On August 5, the most-active contract touched US$10.49, the highest price since January 7, after a drought prompted Russia to ban grain exports, increasing demand for animal feed made from soy.

The US soy crop was valued at US$31.8 billion last year, second only to corn at US$48.6 billion, government figures show.