Soy up for third day on firm cash meal and bargain buying
CHICAGO - U.S. soybean futures were firm on Tuesday, posting advances for the third day in a row, led higher by gains in soymeal linked to active meal exports and strength in cash markets.
Support also came from a strong U.S. crush pace for soybeans, as seen in Monday's National Oilseeds Processors Association (NOPA) monthly crush report.
Corn rose for the second day in a row on short-covering and despite concern about China's recent moves to reject cargoes of U.S. corn that contained a non-approved GMO variety.
Wheat also climbed for the second consecutive trading session on short-covering as the market continued to flounder at the lowest price levels in 1-1/2 years.
At 10:11 a.m. CST (1611 GMT), Chicago Board of Trade January soybean futures were up 6 cents at $13.43-3/4 per bushel, corn for March delivery was up 4 at $4.27-1/4, and March wheat was up 2-3/4 at $6.24-1/2.
Positioning lent underpinning to all three markets, but there was reluctance to place fresh net buy orders in wheat, corn or soybeans ahead of the results of a Dec. 17-18 meeting of Federal Reserve policymakers.
"Everybody's waiting on the FOMC meeting tomorrow and that's keeping a lid on activity. The market is a little nervous before the meeting...," said Sterling Smith, futures specialist for Citigroup.
There is concern the Federal Open Market Committee may begin to wind down its market-friendly bond-buying economic stimulus program.
That stimulus has been a major contributor to the equities markets gains this year and also has been affecting market sentiment in commodities.
Domestic and export demand for soybeans and soymeal has been brisk, a fact demonstrated in Monday's NOPA report.
"The NOPA numbers were healthy, but traders are nervous because there could be cancellation of Chinese orders for U.S. beans as they gain confidence in the South American crop," Smith said.
NOPA on Monday said U.S. members crushed 160.1 million bushels of soybeans in November, up from 157.1 million in October and the most in any month since January 2010.
Gains in soybeans have been slowed due to prospects for a bumper South American soybean harvest early next year and prospects for China to shift its buying of soy away from the United States to South America.
Overall satisfactory crop weather continues in South America, with the few dry areas likely to receive showers soon, said Don Keeney, meteorologist for MD Weather Services.
"Temperatures reached the low 100s (degrees Fahrenheit) in southwest Argentina this week but there is no major damage expected," he said.
Keeney said the dry areas in Argentina were in small crop-growing regions and that corn and soybeans are not mature enough at this time to be harmed by heat or drought.
Overall satisfactory crop weather continues in Brazil, Keeney said.