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CBOT soyabean ends firmer with hand from surging wheat

CHICAGO: Soybean futures at the Chicago Board of Trade ended higher Wednesday as a surge in wheat prices helped spark a rebound from early weakness in the soy complex, traders said.

Soybeans settled 2-1/4 to 3-3/4 cents per bushel higher, with March up 3-1/2 at $5.03-3/4 after falling as low as $4.96-3/4 earlier.

Prices sank initially in response to an improved crop outlook in South America following rains last week in southern Brazil and this week in Argentina.

But the market quickly rebounded after March futures held above a key support level of $4.95, and gathered momentum as CBOT wheat jumped more than 6 cents following comments from U.S. Department of Agriculture Secretary Dan Glickman.

Glickman, speaking at an industry conference in Las Vegas, said wheat producers "will be pleased" with the amount of wheat included in a new food assistance programme to be announced within the next few days. It was not known whether the programme would include soyabeans or soy products.

Last year, the U.S. shipped 8 million tonnes of wheat and other commodities in food aid, an amount that Glickman called a "high-water mark."

CBOT soyabeans "managed to hold those gains, mainly because of the strength in the wheat market," said Robert Lekberg, grain and oilseed analyst for Goldenberg, Hehmeyer & Co. in Chicago.

Lekberg also attributed the rebound in the soy complex to traders "evening up" ahead of the USDA's next round of monthly supply and demand reports on Friday.

Some analysts looked for a slight downward revision in the USDA's forecasts for South America's soyabean crop, due to the effects of persistent dryness since the planting season in October and November.

In January's reports, the USDA projected soyabean production in Brazil and Argentina the world's second- and third-leading soyabean producing nations behind the United States at 31 million tonnes and 19 million tonnes, respectively.

Much of the dryness-stressed soyabean acreage in South America has stabilised in the wake of rains over the past week, meteorologists said.

Scattered light showers fell over the past 24 hours in Argentina's corn and soyabean areas, Weather Services Corp. said Wednesday. Over the next five days, the same areas should receive scattered showers of 1/2 to 1-1/2 inch.

In the trading pit, Refco Inc. bought at least 700 March contracts, floor sources said. Up to late trading, ADM Investor Services bought 100 March and 400 May and sold 200 July, and O'Connor sold 300 March. Soybean futures volume during Wednesday's pit session was estimated by the CBOT at 37,000 contracts, compared to 42,018 Tuesday.-Reuters