Soybeans headed for a fifth weekly climb in the best run since May on speculation that the U.S. Department of Agriculture will cut its production outlook after hot, dry conditions harmed crops in the world’s biggest grower.
The contract for November delivery rose as much as 0.4 percent to $13.7225 a bushel on the Chicago Board of Trade and was at $13.67 at 9:45 a.m. in Singapore, poised to gain 0.7 percent this week.
Futures surged 13 percent in August as the hot weather in the Midwest threatened yields. The USDA may reduce its domestic harvest estimate to 3.134 billion bushels from 3.255 billion forecast last month, according to a survey of analysts and traders by Bloomberg News. Rain should remain quite limited in the eastern Plains, Midwest, and Delta this week, allowing drought conditions to expand, MDA Information Systems LLC said.
“Weather forecasts for the U.S. Midwest still remain unfavorable for U.S. soybean production, with above average temperatures forecast over the next fortnight, leaving the market concerned that U.S. soybean yields could still decline further,” Paul Deane, an agricultural economist at Australia & New Zealand Banking Group Ltd. in Melbourne, wrote in a note today. The USDA will update the production estimate on Sept. 12.
About 54 percent of U.S. soybeans were rated in good-or-excellent condition as of Sept. 1 from 58 percent a week earlier, according to the USDA. Crops have deteriorated for three straight weeks, USDA data show.
Wheat for delivery in December declined 0.2 percent to $6.39 a bushel, down for an eighth day in the worst streak since July 1. Corn for December delivery advanced 0.2 percent to $4.6175 a bushel after dropping to $4.57 yesterday, the lowest price since Aug. 15. Prices are heading for the first weekly loss in four.
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