August 31, 2010

US soy futures fall on speculation global supplies may exceed demand

US soy futures fell for the first time in four sessions on speculation that inventories available to makers of animal feed and cooking oil remain adequate.

World inventories on October 1, before this year's US harvest, will rise 44% to a record 63.52 million tonnes, the USDA estimates. South America produced the largest crop ever, and US output may rise 2.2% to a record, the USDA said. Soyoil fell for the first time in three sessions as weaker crude oil prices reduced the appeal of fuel made from crops.

Soy futures for November delivery fell 3.5 cents, or 0.3%, to close at US$10.225 a bushel at 1:15 p.m. on the CBOT, the first decline since August 24. Before today, the most-active futures rose 14% since the end of June on speculation that too much rain in June reduced US yields. On August 5, the oilseed reached a seven-month high of US$10.49.

Soyoil futures for December delivery fell 0.27 cent, or 0.7%, to close at 40.53 cents a pound in Chicago. Earlier, the price rose to 41.1 cents, the highest level since August 19.

The soy crop in the US, the world's largest grower and exporter, was valued at US$31.8 billion last year, second only to corn at US$48.6 billion, government figures show.