US soya rises on weak dollar

US soyabeans edged higher on Friday, boosted by Chinese demand and a weaker dollar while US wheat also rose in a modest rebound from the prior session's four-month low. Corn was little changed as it continued to struggle with sluggish demand.
"China is clearly using the lower price level to import. This week alone, China has evidently bought 500-600 thousand tons of soyabeans to build up its state reserves," Commerzbank said in a market note on Friday. China stepped up soyabean purchases this week to fill state reserves, buying more than 500,000 tonnes to take advantage of lower global prices, and traders said more deals were likely.
January soyabeans on the Chicago Board of Trade stood 6-3/4 cents or 0.6 percent higher at $11.75 a bushel at 1227 GMT. The front month has fallen about 20 percent after trading as high as $14.56 a bushel in late August. "We see bargain hunting taking place because of the sharp drop yesterday as China will take this opportunity to buy more soyabeans," said Ker Chung Yang, an analyst at Phillip Futures in Singapore.
Imports by China, which buys 60 percent of the soyabeans traded across the world, are likely to climb more than 10 percent to around 58 million tonnes in the year to September 2012 as the nation ramps up pork production to ease tight supply, and food inflation, analysts say. US soyabean export sales were on the upswing as South American suppliers appeared to finally be running low on old-crop supplies, opening a window of opportunity for US soya.
Net US soyabean export sales last week rose 23 percent to a seven-week high of 751,200 tonnes, most of it for shipment in the current marketing year, topping trade estimates for 500,000 to 700,000 tonnes, USDA data showed. Corn was little changed, struggling to regain ground after the prior session's slump to a five-week low as weak US exports weighed on the market.
CBOT December corn was off 1/4 cent or 0.04 percent at $6.14-1/2 a bushel. The contract slipped to a low of $6.10-1/4 on Thursday. The USDA on Thursday reported corn export sales of 208,900 tonnes, down from last week and well below the range of trade estimates from 350,000 to 600,000 tonnes.
"Asia should take advantage of the current drop in prices to buy because the corn context remains tight with no room for a climatic adversity next year," French analysts Agritel said in a market note on Friday. A weaker dollar provided helped to underpin prices of US wheat although the euro's rebound helped to spark modest losses in Paris milling wheat futures.
The euro rose against the dollar on Friday as investors unwound bearish bets on the single currency to book profits ahead of the weekend but, with the euro zone debt crisis escalating, appetite to sell on upticks was high. US wheat prices slid to a four-month low on Thursday, weighed partly by ample supplies.
"There are few concerns relating to the 2011 harvest with northern hemisphere crops now made and prospects remaining good for Australia and Argentina," David Sheppard, managing director of UK merchant Gleadell said in a market note on Friday. "Early indications for 2012 would point to another bumper crop, with US plantings projected to remain unchanged and Strategie Grains projecting the EU crop up 5 percent."
CBOT December wheat rose 2-1/4 cents or 0.4 percent to $5.94-3/4 a bushel. The contract had slipped to a low of $5.90-1/4 on Thursday. Prices in Paris were, however, lower with January off 1.25 euros or 0.7 percent at 181.75 euros a tonne. "Prices fell following lower Chicago prices seen yesterday and because we don't have any new business, we are expensive compared to the Black Sea region and the Southern hemisphere," one European trader said.