US soya up 2.2 percent

US grains futures rose on Tuesday as traders focused again on dry weather in South America. Bargain buying, encouraged by the weaker dollar, emerged after last week's price slump and lent further support. Markets looked past the ratings downgrade in Europe late on Friday to the possibility of China keeping interest rates low in a bid to bolster its slowing economy. China has the second largest economy in the world and is a major buyer of commodities.
"The trade is starting to believe now that China is probably going to become a little bit more of a regular customer of the United States, especially with the stress on the Brazil and Argentinian crop," said Bill Gentry, a broker for Risk Management Commodities. "There are a lot of people that believe that with the damage done to their crop (in South America), the rains that we are getting are too little too late." Grains were pummelled last week after the US Department of Agriculture painted a brighter picture for grain stocks in the United States and reported winter wheat seedings which topped trade expectations.
"We had a pretty sharp drop here after the USDA reports last week and now you have got outside markets obviously supporting," said Jerod Leman, a broker with Wellington Commodities Corp in Indiana. "You have got a little bit of bargain-basement picking."
Soyabean futures led the way higher, rising 2.2 percent after last week's 2.7 percent decline. "It's hot and dry again in Argentina so here we go. Weekend rains were very disappointing and there is not a lot of rain in the forecast," said Mary Ann Kwiatkowski, analyst for Amber Trading.
Dry weather remains a concern in Argentina despite recent rainfall that provided some relief from the extended period of heat and dryness that stressed corn and soyabean crops. Hamburg-based oilseeds publication Oil World cut its forecast of 2012 soyabean crops in Argentina and Brazil by a combined 3.8 million tonnes due to the dry conditions. The worries about South American weather also supported corn futures, but wheat lagged the other two commodities due to a lack of fundamental support.
Chicago Board of Trade March soyabean futures rose 25-1/4 cents to $11.83-1/2 a bushel. CBOT March corn gained 6-3/4 cents to $6.06-1/4 a bushel while CBOT March wheat was up 2-1/2 cents at $6.04-3/4 a bushel. Soyabeans rallied above key technical resistance points at the 30-day and 50-day moving averages.