May 27, 2010

Soy futures have risen from a 10-week low on speculation that rising demand for food and livestock feed in China will outweigh the European debts.

The Organization for Economic Cooperation and Development raised its growth forecasts for 2010 and 2011 as emerging economies such as China outpace debt-burdened developed countries to drive the global expansion. Crude oil jumped the most in three months and equities rose after a government report showed expanding US manufacturing.

"China still remains part of the demand story," said Jim Gerlach, the president of A/C Trading Inc. in Fowler, Indiana. "Soybeans are getting a bounce today from the rally in stocks and crude oil."

Sales of US soy in September 1-May 13 totalled 38.119 million tonnes, a 14% increase from 33.523 million during the year-earlier period, USDA data show.

China will import 46 million tonnes from all suppliers in the year that ends October 1, up from a 43.5 million forecast a month ago and a record 41.1 million a year earlier, the USDA said this month. Imports may grow to 49 million next year.

The soy crop in the US was valued at US$31.8 billion last year, second only to corn at US$48.6 billion.