Soybeans advanced to a high not seen in more than 11 months in Chicago as traders hoped that demand for the livestock feed will surge in China in the wake of recovering prices for eggs and pigs. Corn rallied too.
A Bloomberg study found that Chinese factories placed orders for 600,000 metric tons of soybeans for import after September 11. Egg prices in China have increased 26% while hogs soared 20%, figures from Shanghai JC Intelligence Co. showed. Bird flu and declining pork prices checked demand for soybean meal that’s used in feed earlier this year, with a US-based industry organization saying in April that China was likely to default on certain soybean shipments.
“The market concern for Chinese demand has diminished, with improving conditions evident. Chinese domestic prices for pork, soybean meal, corn and wheat have all rallied in the last month,” a report from Australia & New Zealand Banking Group Ltd. stated today.
The per-bushel price of July-contract Soybeans added 1.7% to $15.31 as of 7:45 am on the Chicago Board of Trade, the world benchmark. The price hit $15.3675 earlier, a high not seen by a most-active future since June 5. Futures have advanced 18% this year.
US traders have exported 27.6 million tons of soybeans to China for delivery before August 31, the end of the 2013-14 marketing year, with further 5.1 million tons expected to be sold there within the 2014-15 period, data from the US Department of Agriculture showed today.
Corn for delivery in July added 1.3% to $4.8075 per bushel in Chicago. Wheat for delivery in the same period was up 0.5% to $6.6725 per bushel.
According to Moneycontrol, soybeans have received good support in recent weeks in the wake of dwindling US inventories following rising export demand.
Government figures show that soybeans constitute the second-biggest crop in the US.
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