Commodities Report: Soybeans Surge on Forecasts For Hotter and Drier Weather
CHICAGO -- Soybean prices closed sharply higher yesterday amid a rare agreement in weather forecasts suggesting hotter and drier-than-normal weather is likely to become entrenched during the first half of August.</br></br>While soybeans can handle some heat and dryness in July, August is the time frame when U.S. soybean yields are determined. After one of the hottest summers since the drought of 1988, soybeans' recuperative powers have been curtailed already this season.</br></br>On the Chicago Board of Trade, the most actively traded November soybean futures contract jumped 18.50 cents a bushel to $5.3650.</br></br>While some skeptical soybean-market bears said some of the rally was a function of end-of-the-month commodity fund positioning, many believe the recent increased volatility is likely to remain a feature of this market into the South American harvests through next May.</br></br>"Today's rally was the culmination of three different factors," explained Dale Durchholz, a market analyst for the farm marketing firm of AgriVisor Services Inc. in Bloomington, Ill.