Soybeans Advance 2.5% on Dollar, Smaller U.S. Harvest Estimate

Aug. 24 (Bloomberg) -- Soybean futures gained for a second day, jumping as much as 2.5 percent, after the dollar weakened and the Professional Farmers of America said U.S. harvests may be smaller than expected.

The dollar weakened against most major currencies, making U.S. supplies cheaper for importers. Pro Farmer’s survey last week of soybean fields in the world’s biggest grower and exporter forecast output will be 3.15 billion bushels, less than the government estimate of 3.199 billion bushels.

“The weaker U.S. dollar at the moment is what the market is focusing on,” Jonathan Barratt, managing director at Commodity Broking Services Pty. in Sydney, said by phone today. Weather-related crop damage will “add some support and we should see the market up a bit today,” he said, referring to the soybean and grains complex.

Soybeans for December delivery climbed as high as $9.975 a bushel in after-hours electronic trading on the Chicago Board of Trade and last traded at $9.935 a bushel at 9:54 a.m. in Singapore.

Soybeans for May delivery on the Dalian Commodity Exchange rallied as much as 2.6 percent to 3,722 yuan ($545) a metric ton, before trading at 3,708 yuan at 9:35 a.m. Singapore time.

Pro Farmer, a marketing and information company, also forecast corn output in the world’s biggest grower and exporter will be 12.807 billion bushels, more than the 12.761 billion estimated by the U.S. Department of Agriculture on Aug. 12. The USDA’s next output estimate will be released Sept. 11.

Corn for December delivery added as much as 1.7 percent to $3.3175 a bushel in Chicago, before trading at $3.2925 a bushel. Corn for delivery in May on the Dalian Commodity Exchange gained as much as 2.5 percent to 1,755 yuan a ton, before trading at 1,736 yuan at 10:25 a.m. Singapore time.

Frost Threat

“If a Sept. 25 frost ends the season, neither corn nor soybeans will reach these levels,” Pro Farmer said. “A two- week-late frost could pump up final yields.” Many farmers will begin harvesting next month.

Ukraine, the world’s fourth-largest corn exporter, and Russia will have “major losses to corn,” because of prior hot, dry weather during this growing season, forecaster DTN Meteorlogix LLC said in a report Aug. 21. South and east Ukraine and South Russia will have “little rainfall” in the seven days from Aug. 21, it said.

Wheat for December delivery added 0.7 percent to $4.905 a bushel. The contract dropped to $4.855 a bushel on Aug. 19, the lowest in more than eight months.