Posted on 02/22/2008 7:53:02 AM PST by TigerLikesRooster
Soybean futures hit 34-year high on strong demand
By JACKIE FARWELL, AP Business Writer
NEW YORK 12/28/07 ?Soybean futures rose to their highest level in more than 30 years Friday as traders bet on robust exports next year and continued strong demand from China.
Gold prices also climbed, boosted by strong oil prices, weak economic data in the U.S., and geopolitical concerns following Thursday’s assassination of Pakistani opposition leader Benazir Bhutto.
Other agricultural futures were mixed, while oil prices advanced.
U.S. exporters have already sold roughly three-quarters of the soybeans the Agriculture Department predicts for the whole marketing year, which ends in June 2008. To make up for dwindling inventories, analysts say farmers need to plant more soybeans than they did last year ?when an ethanol boom led farmers to favor planting corn acres over soybeans.
So far this year, soybean exports are running at 735 million bushels, or about 74 percent of the USDA’s total estimate of 995 million bushels. Last year, the farmland dedicated to soybean plantings was reduced by 15 percent.
Fueling Friday’s record was continued strong demand from China, the world’s largest consumer of soybean oil, said DTN commodities analyst Elaine Kob.
“It’s really been an impressive week for soybeans,” she said.
A bushel of soybeans for January delivery jumped to $12.48 overnight, beating June 1973’s closing high of $12.10 but still shy of that day’s trading record of $12.90 a bushel. In morning trading, prices dropped 0.75 cent to $12.20 a bushel.
March corn rose a penny to $4.5325 a bushel. March oats fell 3 cents to $3.06 a bushel, while wheat for March delivery fell 11.25 cents to $9.30 a bushel.
Gold prices advanced on the precious metal’s appeal as a safe haven investment during political uncertainty. Bhutto’s assassination in a suicide bombing has stirred investor worries about further instability in the region.
“The geopolitical background continues to unnerve a lot of people,” said Jon Nadler, senior analyst at Kitco Bullion Dealers, adding that gold has “the potential to close out the year at its very peak.”
The dollar’s steep drop against the 13-nation euro this year has been a major driver behind gold’s advance from less than $650 an ounce in January to a 28-year high near $850 an ounce in November. Gold futures are up nearly 32 percent this year, Nadler said.
An ounce of gold for February delivery added $11.20 to $843 on the New York Mercantile Exchange. March silver climbed 14.91 cents to $14.91 an ounce, and Nymex copper for March delivery fell .54 cent to $3.0780 a pound.
The euro bought $1.4711 in afternoon European trading, up from $1.4627 in late New York trading on Thursday.
Hampering the rise of gold and other commodities was a government report showing sales of new homes fell in November to their lowest level in more than 12 years.
The Commerce Department said new home sales fell 9 percent from October to a seasonally adjusted annual rate of 647,000.
Commodities into the limelight.
Ping!
Ironically, the Asian Soybean Rust might put an end to this. ASR spores were found in the USA late last year, too late to affect the yeild.
There will be plenty of fungicides used this year to protect this increasing valuable crop.
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