Brazilian uncertainty hits US soya

By Joanna Newman

US soya-bean traders are busy phoning up their friends in Brazil these days to chat about the weather, or poring over satellite maps.

There is a lack of clear meteorological data from Brazil as the farmers in the southern hemisphere plant their soya-bean crop, and this is causing confusion.

Some reports suggest too little rain for planting in Brazil, which is causing delays, or even replanting after the first attempt failed to germinate. Other recent reports point to precipitation this coming weekend, which would alleviate the situation.

This is the time of year when the northern hemisphere market is governed by planting conditions in South America. Amid the uncertainty, Chicago futures contracts are zigzagging nervously.

The Chicago January futures contract settled on Thursday (3 December) at 581.0¢/bushel, down 6.75¢ from Wednesday, but up from 571.25¢/bushel just before the Thanksgiving holiday last week.

Soya meal prices firmed up this week, amidst rumours that the dry conditions in South America are causing either Brazil or Argentina to suspend their meal exports, possibly in order to preserve soya bean stocks or because of a slowdown in crush operations.

Whatever the cause, there are reports of cargoes being switched to US soya meal.

The Chicago soya meal December futures contract settled on Thursday (3 December) at US$149.20 /t, up by around US$9.00 from a week ago.