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CBOT soyabeans tumble to end lower on US weather

CHICAGO: Soyabean futures at the Chicago Board of Trade closed sharply lower on Monday amid heavier-than-expected weekend rain in the U.S. Midwest growing region and forecasts for more moisture this week, traders said.

CBOT soyabeans settled 6-1/2 to 11-3/4 cents per bushel lower, with May off 11-3/4 at $5.25-3/4. The slide followed gains of 10 to 13-1/2 cents Friday amid forecast for below-normal rainfall and above-average temperatures in spring.

"The market was a captive of the weather," said Vic Lespinasse, floor commentator for AG Edwards & Co. at the CBOT.

CBOT traders said roller-coaster price rides were likely to be a common feature of the market as weather developments influence the trend over the next few months.

An unseasonably warm and dry winter has depleted soil moisture in many areas of the Midwest, with timely rains needed to replenish fields ahead of and following spring plantings.

Players last week built a premium in the market to reflect uncertainty over crop prospects following a U.S. government warning of a drought in the Midwest this spring.

The National Weather Service 30- to 90-day forecast last Thursday seemed to reinforce outlooks for a drought.

But heavier-than-expected rainfall in the Midwest coupled with forecast for more this week battered the market Monday.

"The market reacted like it should in any given weather market," said analyst Dave Maher with Securities Corp. of Iowa.

He however noted that commodity funds, which were behind most of last week's rallies, were not heavy sellers, indicating their intention to hold on to their weather-linked positions, for now. Funds sold about 2,500 contracts on the day.

On Monday, Weather Services Corp. meteorologist Joel Burgio said the Corn Belt benefited from weekend rain and that the region was expected to receive more moisture this week.

He said there was a chance of showers in the eastern Corn Belt Monday and Wednesday while Tuesday would be dry.

The extended outlook called for 0.25 inch to 0.75 inch of rain in the Midwest on Thursday and Friday.

Burgio said the central and southern Midwest received the heaviest rainfall with "some pretty decent rains in central Illinois and central Indiana, some of the big acreage country."

"There was snow and rain in the western Corn Belt of from 0.10 inch to 0.35 inch in the west and from 0.30 inch to 1.00 inch in the eastern Corn Belt," Burgio said.

Meanwhile, Memphis-based analytical firm Sparks Cos. has forecast U.S. soyabean plantings this year at 74.89 million acres, trade sources said.

In 1999, U.S. farmers planted 73.8 million acres of soyabeans, according to the U.S. Department of Agriculture. The USDA 2000 plantings report is slated for release on March 31.

Traders said some support was seen from delays in the soyabean harvest in Brazil, the world's second largest producer after the United States.

Brazilian analyst Safras e Mercado said on Monday that by March 17, farmers had harvested 14 percent of the 1999/2000 soyabean crop, well behind the 1999 pace and the five-year average.

Harvesting at this time in the 1998/99 season was reported at 20 percent, and the five-year average at 22 percent, Safras data showed.

Farmers in top soyabean producing state Parana had only harvested 10 percent of the planted area, well below the 27 percent of a year ago and the 33 percent five- year average.

Although Parana's crops are late maturing this season because of the disruption in planting caused by the drought, climatic conditions look favorable for harvest, it said.

Safras said excessive rains over the last few months in the center-west region have interrupted harvest operations and jeopardized soyabean quality.

O'Connor sold 2,500 May contracts, E D&F Man International sold 300 July, Refco Inc. sold 300 May, 100 July, FIMAT Futures bought 1,200 May, 300 July, Cargill Inc. bought 400 May.

Soyabean futures volume was estimated by the CBOT at 53,000 contracts, compared to 58,036 traded Friday.

Soyabean options volume was estimated at 17,000 contracts.ÑReuters