BLBG:Soybeans Head for Fourth Weekly Gain as China Boosts Purchases
Soybeans were set for a fourth weekly advance, the best run since February, on increasing demand from China as U.S. inventories contract.
The contract for July delivery climbed 0.3 percent to $15.0325 a bushel on the Chicago Board of Trade at 2:22 p.m. in Singapore, poised for a 3.8 percent increase this week. Prices earlier dropped as much as 0.8 percent as shipments resumed at Argentina’s largest grain-exporting port, where operations have been stopped since May 20 because of a strike.
Futures gained for a sixth day yesterday, the best rally since March 2012, after the U.S. Department of Agriculture said China bought 531,000 metric tons of U.S. soybeans in the week ended May 16 for delivery after Sept. 1. Prices jumped 7.5 percent in May, heading for the biggest monthly rally since July, when the worst U.S. drought since the 1930s eroded production and sent soybeans to a record in September.
“The market still seems surprisingly tight,” said Paul Deane, an agricultural economist at Australia & New Zealand Banking Group Ltd. (ANZ) in Melbourne. “Recent sales have been running ahead of what the USDA is forecasting and that can’t continue. That’s why we’ve seen a squeeze on prices.”
U.S. reserves on Aug. 31 will shrink to 125 million bushels, the lowest since 2004, the USDA estimates.
Corn for December delivery lost 0.4 percent to $5.3275 a bushel. Wheat for July fell 0.2 percent to $7.0175 a bushel.
To contact the reporter on this story: Phoebe Sedgman in Melbourne at psedgman2@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
