Soybeans Gain Before USDA Report Set to Signal Lower U.S. Output
Soybeans rose in Chicago before a government report tomorrow that may show the U.S. crop, the world’s largest, will be smaller than previously expected after dry weather in the past month.
U.S. farmers may harvest 3.13 billion bushels of soybeans, 3.7 percent less than estimated a month ago, according to a Bloomberg survey of analysts before the Department of Agriculture updates its projection. Parts of Iowa and Illinois, the biggest growing states, had as little as 5 percent of normal rain in the past 30 days, National Weather Service data show.
“August weather is key to setting U.S. soybean yields, with conditions over the month signaling a large cut to expected production,” Goldman Sachs Group Inc. analysts including Jeffrey Currie in New York wrote in a report today. “This will limit the recovery in already-tight U.S. inventories and will limit the decline in soybean prices in coming months.”
Soybeans for delivery in November gained 0.2 percent to $13.5725 a bushel at 4:45 a.m. on the Chicago Board of Trade, rebounding from two sessions of declines. Futures climbed 13 percent since the end of July as dry weather and heat intensified in the Midwest.
The USDA cut its condition ratings for the soybean crop for four straight weeks, saying 52 percent of fields were in good or excellent condition as of Sept. 8, down from 64 percent that received the top ratings in early August. Corn conditions deteriorated to 54 percent good or excellent from 64 percent over the same period, USDA data show.
Corn for delivery in December dropped 0.1 percent to $4.685 a bushel. Prices slumped 33 percent this year on expectations the U.S. harvest will rebound to an all-time high after drought curbed last year’s production.
The USDA may lower its forecast tomorrow for the U.S. corn harvest to 13.6 billion bushels, 0.9 percent below its previous outlook while still the largest crop on record, according to Bloomberg’s survey.
Wheat for delivery in December climbed 0.3 percent to $6.4875 a bushel. Milling wheat for delivery in November fell 0.1 percent to 187.50 euros ($248.73) a metric ton on NYSE Liffe in Paris. Egypt, historically the world’s biggest importer of the grain, bought 235,000 tons of wheat in a tender yesterday from Ukraine, Russia and Romania.
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