U.S. soybean futures rose on Friday, as worries that dry weather in Argentina will limit the size of the crop from the key South American producer supported prices, traders said.
Corn and wheat also were firm, largely due to spillover strength from the rally in the soy market, but gains were limited by concerns about export demand for U.S. supplies.
Soybeans also generated strength from strong end-user demand for soymeal as well as technical buying as prices passed through key resistance points during Friday’s rally.
Not much rain was expected in Argentina for the next week to 10 days, but a storm system was forecast for Christmas day. Only 0.5 inch or less of moisture was expected, covering 65 to 70 per cent of the total crop area, according to Global Weather Monitoring.
“With Argentina looking worse as opposed to better from the beginning of the week to now, I think they have decided to put some weather premium in,” said Mike Zuzolo, president of Global Commodity Analytics.
Chicago Board of Trade January soybean futures were up 12 cents at $13.39 (all figures US$). The contract pushed through key technical resistance points at its 20-day and 10-day moving averages.
Traders also said many investors were shoring up positions ahead of what is expected to be a week of light trading volumes. Markets will be closed for Christmas on Wednesday and many traders are taking the whole week off.
“The bean pit and the meal pit are still long and you have people that want to defend those positions,” said Roy Huckabay with the Linn Group, a Chicago brokerage.
For the week, CBOT soybeans were up 0.8 per cent.
CBOT March corn was up 2-3/4 cents at $4.33-1/4 a bushel and notched a weekly gain of 3.2 percent, its biggest in four months.
The Chinese government’s quarantine authority confirmed on Friday that has rejected a total of 545,000 tonnes of corn from the U.S. due to an unapproved genetically modified strain.
U.S. officials had earlier said they would urge China to act promptly to approve the variety, known as Agrisure Viptera and developed by Syngenta, and raised the issue with Beijing during annual trade talks between the two countries.
Export concerns also capped gains in wheat, which was trading higher following six straight days of declines that wiped 4.7 per cent off its value.
The benchmark CBOT March soft red winter wheat contract settled up 2-3/4 cents at $6.13-1/2 a bushel. For the week, the contract dropped 2.4 per cent, its third straight week of declines.
Traders also noted some short-covering after wheat prices fell to their lowest since May 2012 during the overnight session.
— Mark Weinraub is a Reuters correspondent covering grain futures markets from Chicago.