Chicago | Reuters—Chicago Board of Trade soybean futures touched a two-week high on Friday on worries that heat may threaten U.S. crops and expectations that the country’s biofuel policy would boost demand for soyoil, analysts said.
Soyoil futures set contract highs for a second day, while corn and wheat futures also finished stronger.
For the week, soybeans Sv1 advanced about 2.8% and corn Cv1 climbed 3.8 per cent. The rallies were a turnaround after themarkets were recently under pressure from projections for large U.S. harvests and plentiful supplies from South America.
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“Traders woke up to a grain market that looks more lively than it has in quite some time,” said Arlan Suderman, chief commodities economist for StoneX.
Most-active soybean futures Sv1 ended up 9-1/4 cents at $10.35-3/4 a bushel and hit the highest level since July 3.
The market set a three-month low on Monday but began to recover on Wednesday on hopes for increased demand for U.S. supplies from Indonesia and top importer China.
Traders also focused on expectations for strong U.S. soyoil demand due to government mandates for renewable fuels to be blended into the nation’s fuel mix.
CBOT August soyoil BOQ25 set a contract high of 57.17 cents per pound before turning lower.
“The bean oil market has been on a tear higher,” CHS Hedging said.
Traders monitored U.S. weather forecasts amid concerns about the risk for heat to damage developing corn and soy crops.
Temperatures will increase across the Corn Belt starting next week, weather forecaster Vaisala said. Heat stress is possible in southwestern areas but probably not across the heart of the region, the firm said.
The U.S. Department of Agriculture is slated to issue a weekly update on crop conditions on Monday.
CBOT corn Cv1 closed up 6-3/4 at $4.27-3/4 a bushel and reached the highest price since July 3. The market rebounded on short covering and bargain buying after setting contract lows on Monday.
Wheat futures Wv1 leapt 12-3/4 cents to $5.46-1/4 a bushel as U.S. farmers moved closer to finishing winter wheat harvests.
—Additional reporting by Peter Hobson and Sybille de La Hamaide.
