Feb. 24 (Bloomberg) -- Soybeans rose to a five-month high on speculation that excessive rain in Brazil, the biggest exporter, damaged crops. Wheat also gained, and corn declined.
While some areas of Brazil are experiencing drought, the nation’s main soybean-growing state of Mato Grosso received 230 millimeters (9 inches) of rain in the past week, reducing crop quality and paring yields, AgRural said yesterday. The crop researcher said Feb. 17 that production would reach 87 million metric tons, down from 88.8 million estimated on Jan. 31.
“Too much rain is shrinking the size of the Brazilian crop,” Jerry Gidel, the chief feed analyst for Rice Dairy LLC in Chicago, said in a telephone interview. “The trade is adjusting to a smaller harvest and potential for an increase in U.S. exports.”
Soybean futures for May delivery advanced 1.1 percent to close at $13.75 a bushel at 1:15 p.m. on the Chicago Board of Trade, after touching $13.78, the highest price since Sept. 13.
The oilseed, which is used to make animal feed and cooking oil, gained 6.4 percent this year as U.S. export sales for shipment before Sept. 1 rose 27 percent above a year earlier.
Soybeans inspected for export in the week ended Feb. 20 rose 68 percent to 1.271 million metric tons, compared with 755,809 a year earlier, the U.S. Department of Agriculture said today. China, the biggest importer and consumer, took 54 percent of the total, USDA data show.
“Export shipments continue to be strong, eroding U.S. supplies,” Gidel said.
Wheat futures for delivery in May gained 1.9 percent to $6.17 a bushel in Chicago, after touching $6.175, the highest for the most-active contract since Dec. 19.
Prices rose on speculation that forecasts for dry weather in the next 30 days may intensify drought in the U.S. Great Plains, reducing yield potential for crops as they emerge from winter dormancy, Gidel said.
Corn futures for May delivery fell 0.3 percent to $4.5775 a bushel on the CBOT.
--With assistance from Carlos Caminada in Sao Paulo. Editors: Millie Munshi, Steve Stroth