Soybeans Rise on Increased Demand for Animal Feed, Cooking Oil

Soybeans rose for a fourth straight day after a U.S. government report showed export demand for the oilseed and its products increased last week.

Exporters sold 214,090 metric tons of soybeans in the week ended March 11, up 68 percent from the prior four-week average, the government said. Sales for delivery after Sept. 1 totaled 525,000 tons, including 390,000 to China. Animal-feed purchases jumped to 92,495 tons from 1,904 tons, while soybean-oil sales came to 18,411 tons, after cargoes were canceled last week.

“Export demand was better than expected,” said Christian Mayer, a market analyst for Northstar Commodity Investment Co. in Minneapolis. “The sales to China next season also added to the bullish outlook.”

Soybean futures for May delivery rose 0.5 cent to $9.595 a bushel on the Chicago Board of Trade, after gaining 3.6 percent the previous three sessions. The commodity has fallen 8.5 percent this year on forecasts for record production in Brazil and Argentina, the biggest exporters of animal feed and cooking oil.

Investment demand for soybeans has risen this week as the dollar fell and growth improved in emerging economies, boosting the outlook for increased food and animal-feed demand, Mayer said.

“Traders are going to reduce positions before the end of the month,” Mayer said.

Corn is the biggest U.S. crop, valued at $48.6 billion in 2009, followed by soybeans at $31.8 billion, government figures show.

By Jeff Wilson
Source: Bloomberg