Soybean futures fell to a 11-week low on speculation that rain will boost yield potential in South America, reducing demand for supplies from the U.S., the world’s biggest exporter. Corn rose.
Rain this week in southern Brazil and most of Argentina will improve soil moisture for planting and early crop development, Global Weather Monitoring said in a report today. Soybean production in Brazil may rise 19 percent from a year earlier to a record 79.1 million metric tons when harvesting begins in January, the consultant Celeres said yesterday.
“Rain in South America means the crops are off to a good start, and that increases the odds for a big harvest,” Brian Grete, the senior market analyst for Professional Farmers of America newsletter in Cedar Falls, Iowa, said in a telephone interview. “Rising crop potential has reduced speculative buying.”
Soybean futures for November delivery dropped 1.9 percent to close at $15.305 a bushel at 2 p.m. on the Chicago Board of Trade, after touching $15.265, the lowest since July 13.
The oilseed, used to make animal feed and vegetable oil, has tumbled 14 percent since reaching a record $17.89 on Sept. 4 on speculation that August rains boosted U.S. yields. The government will release its production update on Oct. 11.
Corn futures for December delivery gained 0.2 percent to $7.5825 a bushel on the CBOT. The grain jumped 19 percent in the three months ended Sept. 30, the biggest quarterly gain since the end of 2010, after the worst drought in more than 50 years reduced damaged crops. The U.S. Department of Agriculture estimates production will tumble 13 percent this year.
Deutsche Bank AG said today that corn futures may rise 10 percent after the U.S. harvest is completed as demand exceeds supply. About 54 percent of the corn was gathered as of Sept. 30, up from an average of 20 percent for that time of year in the previous five seasons, the USDA said yesterday in a report.
Corn is the biggest U.S. crop, valued at $76.5 billion in 2011, followed by soybeans at $35.8 billion, government figures show.