Soy commentary: Futures rise 4% on week as traders fear 3-day w/end

Futures on the Chicago Board of Trade as well as cash prices were poised to end the week broadly up 4% on Argentinian drought fears that have seen more than half the crop rated as poor or very poor.

Futures hit a 6.5-month high of $10.28/bu during trade on Friday and was valued at $10.25/by 1800 London time, although sources warned of the possibility of a correction later in the day as traders may look to book profits ahead of a long weekend.

"Don’t discount profit taking ahead of the long holiday weekend," said Terry Reilly, an analyst with Futures International.

Other sources agreed, claiming that there was some concern about volatility on Monday after another weekend of poor precipitation in Argentina that could worsen the crop condition, which meant some could seek to square positions.

Forecasts suggest limited rainfall.

"Either way it's going to sharply up or sharply down,"  said one source.

Elsewhere, BAGE said that 56% of the crop was in poor or very poor condition, although it held its forecast for production steady at 50 million mt.

That wasn’t enough to convince Argentina’s farmers to sell with no activity heard for April, while May was heard bid at $395/mt FOB Up River.

Agricensus assessed at a notional $393.50/mt for both March and April to reflect a carry on local exchanges.

In Brazil, the paper market was largely steady at 60 cents over March futures for March loading and 48 cents over May futures for April loading.

That was set against cargo offers of around 77 cents and 60 cents FOB Santos for March and April, respectively.

Agricensus assessed steady at a 68-cent and 54-cent premium over the relevant futures for March and April loading, equating to $401.50/mt and $400.50/mt FOB Santos.

In the US, little was heard bar a sale of soybean oil to South Korea that was reported through the USDA.

Barge bids were said to be slightly firmer, particularly for April and Agricensus nudged its assessment up to 45 cents and 39 cents over March and May futures, equating to $393.25/mt and $395/mt FOB USG for March and April loading.

In China, value was heard pegged at $1.54/mt over March futures for March loading and $1.46/mt over May futures for April loading.

Agricensus assessed at $1.54/mt for delivery 40 days out, equating to $433.25/mt.

In Europe, offers were heard at $420/mt CIF AR for Brazilian beans. Agricensus assessed at $417/mt.

In other market news, Brazil was said to have sold another 10 cargoes this week, Argentinian sellers were said to be hoping for 6,000 pesos per mt for spot beans ($303/mt) and the Rosario Board of Trade on Monday will cut its Argentinian bean forecast.