Soy Premium Rose as Farmers Withheld Supplies; Corn Basis Steady

Cash premiums for soybeans shipped in May to terminals near New Orleans rose relative to Chicago futures as farmers withheld supplies to concentrate on planting crops. The corn basis was little changed.

The spot-basis bid, or premium, for soybeans delivered this month was 60 cents to 67 cents a bushel above July futures, up from 58 cents to 67 cents yesterday, U.S. Department of Agriculture data show. The corn basis was 56 cents to 58 cents a bushel compared with 57 cents.

“There’s not much inventory right now because farmers are busy planting corn and some soybeans,” said Scott Stoller, a cash grain merchandiser for Michlig Agricenter Inc. in Manlius,Illinois. “Basis on the Illinois river jumped as much as 3 cents for corn and a nickel for soybeans because water levels are falling,” allowing for increased barge loading after flooding caused delays, he said.

Soybean futures for July delivery dropped 30.25 cents, or 2.2 percent, to $13.2175 a bushel on the Chicago Board of Trade, the fourth straight decline.

Corn futures for July delivery fell 20.75 cents, or 2.8 percent, to $7.0875 a bushel in Chicago.

Barge-grain movement on the nation’s river system fell 45 percent to 258,350 metric tons from a week earlier, the USDA said today in a report. Shipments fell 50 percent from a year earlier because of flooding and shipping restrictions on parts of the Ohio and Mississippi rivers, the agency said.

“All locks on the upper Mississippi River are open and operational, but barge operators are encountering navigation restrictions further downriver because of persistent flood conditions,” the government said in the report. “As the flood water drains, points on the lower Mississippi, Ohio, and Arkansas Rivers are expected to reach record levels over the next few weeks.”

(Source: http://www.bloomberg.com/news/2011-05-05/soy-premium-rose-as-farmers-withheld-supplies-corn-basis-steady.html)