October 22, 2007

Rains to perk up 2007/08 soy plantings in Brazil

Brazil, the world's second-largest soy grower after the US, may get as much as 11.5 centimetres (4.5 inches) of rains in the centre-west through November 5 that can boost soy planting for the 2007/08 after a threat of a six-week dry spell, Sao Paulo-based Climatempo said.

Weekend rains and more widespread precipitation in the north may mark the start of the wet season, said John Dee, president of Global Weather Monitoring in Mohawk, Michigan.

Brazil's soy farmers will harvest 59.4 million to 61.3 million tonnes of the oilseed in the crop year that started on Oct. 1, up from the previous year's record of 58.4 million, the Agriculture Ministry said this month.

According to Bill Nelson, vice president for analyst firm A.G. Edwards Inc. the rains that fell over the weekend in Brazil, have allowed farmers to finally plant their soy crops and posted "bearish signs" for soy planting.

Soy trading fell for a second straight session in the Chicago Board of Trade (CBOT) with futures for November delivery falling by 7.5 cents, or 0.7 percent, to US$9.9375 a bushel. Most-active futures still have risen 64 percent in the past year and reached a three-year high of US$10.1775 on September 27 after US farmers planted the fewest acres in 12 years to sow more corn.

Soy meal for December delivery fell 60 cents, or 0.2 percent, to $275.70 a ton, the fourth decline in five sessions. Most-active futures, which reached three-year high of $293 on Sept. 27, have risen 53 percent in the past year.

Soy oil for December delivery fell 0.34 cent, or 0.8 percent, to 40.22 cents a pound in Chicago, a second straight drop after reaching a 23-year high of 41.14 cents on Oct. 18. Most-active futures have climbed 54 percent in a year.