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CBoT Soybean Soars as Export Demand Tightens U.S. Supplies

12 Sep 2020 8:38 am
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Mumbai (Commodities Control) – Chicago Board of Trade soybean futures surged about 2% on Friday, hitting a fresh two-year high on expectations that export demand for U.S. soy would tighten stockpiles more than the U.S. Department of Agriculture (USDA) forecast in monthly reports, traders said.
CBOT November soybeans settled up 18-1/2 cents at $9.96 per bushel after reaching $9.98, the highest point on a continuous chart of the most-active soybean contract since June 2018.September Soybeans closed at $10.05 1/2, up 20 1/2 cents. January 21 Soybeans closed at $9.99 1/4, up 17 3/4 cents and March 21 Soybeans closed at $9.96 3/4, up 16 3/4 cents.
For the week, the CBOT November contract rose 28 cents a bushel, or nearly 3%, its fifth consecutive weekly advance.
Several other soybean futures contracts set life-of-contract highs on Friday, including the nearby September and the January and March contracts.
CBOT December soymeal ended up $7.10 at $324.60 per short ton and CBOT December soyoil rose 0.51 cent to settle at 33.71 cents per pound.
In monthly supply/demand reports, the USDA lowered its forecast of the U.S. 2020/21 average soybean yield to 51.9 bushels per acre, still a record high if realized, but down from 53.3 in August.
The USDA cut its forecast of U.S. 2020/21 soy ending stocks to 460 million bushels, from 610 million in August. But the government left its forecast of soybean exports unchanged from last month, despite a series of near-daily purchases of U.S.soybeans by top global buyer China.
For new crop bean yield, USDA cut 1.4 bpa to 51.9 bpa. Soybean production then fell 112 mbu to 4.313 bbu. USDA foresees the 2020/21 average cash bean price at $9.25/bu – up a large 90 cents from last month. Exports were unchanged, but global trade was up 850, 000 MT to 166.34.
The flurry of export sales should tighten U.S. soy stockpiles below USDA's forecast, analysts said. USDA announced flash sales of 222,000 and 262,000 MT of new crop beans to unknown and China respectively.
On a bearish note, the USDA raised its forecast of Brazil's 2020/21 soybean crop to 133 million tonnes, up from 131 million last month.
Meanwhile, according to CFTC report dated 8th September, soybean speculative traders were 173,907 contracts net long, increasing the net long 11,300 from last week.
Commodity funds were net buyers of Chicago Board of Trade soybean, soymeal and soyoil futures contracts on Friday, traders said.
Support and Resistance for active contract lies at $9.66 and $10.12 per Bushel, respectively.
(Commodities Control Bureau)

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