COMMODITIES : Dry Planting Forecasts Send Soybean Futures Soaring

Forecasts for dry weather in the western Corn Belt sparked a buying binge among soybean futures traders Friday, sending prices soaring to new contract highs on the Chicago Board of Trade. Grain futures were mixed.

On other futures markets, livestock and meat were mixed, energy futures were mostly lower, precious metals were mixed and stock index futures retreated.

Government estimates for a low carry over of U.S. soybean stocks into the next marketing year have focused the market’s attention on the weather as soybean planting begins.

Forecasts earlier in the week had predicted nearly ideal planting conditions this weekend in the western Corn Belt followed by rain early next week, which would get the newly planted seeds off to a good start.

Sensitive to Weather

But new forecasts issued Friday painted a different picture for the coming week. The National Weather Service predicted warmer and slightly drier-than-normal conditions for the region in its 30-day and 90-day forecasts.

“The soybean market is extremely sensitive to weather because if we don’t have a good crop this year they’re going to cut that carry over down to the bone,” said Victor Lespinasse, a trader for Dean Witter Reynolds Inc.

Wheat futures closed mixed while corn futures finished slightly higher.

Wheat settled 2 cents lower to 0.50 cent higher, with the contract for delivery in May at $3.045 a bushel; corn was 1 cent to 2.5 cents higher, with May at $2.0225 a bushel; oats were 0.5 cent to 1.75 cents lower, with May at $1.5925 a bushel, and soybeans were 11.25 cents to 13.75 cents higher, with May at $6.895 a bushel.

Cattle futures settled steady to slightly higher on the Chicago Mercantile Exchange in light trading that reflected nervousness about last week’s government reports showing larger-than-expected numbers of cattle being fattened for slaughter.

“Based on the cattle-on-feed report, we should see substantial feed cattle marketings coming out,” said Tom O’Hare, an analyst in New York with Smith Barney, Harris Upham & Co. “If that happens and the market can’t handle it, we’ll see prices break.”

Crude Oil Futures Fluctuate

Pork futures were mixed to lower because of an increase in the average daily slaughterhouse kills this week, he said.

Live cattle settled unchanged to 0.30 cent higher, with June at 70.90 cents a pound; feeder cattle were 0.02 cent to 0.22 cent higher, with May at 78.67 cents a pound; hogs were 0.25 cent lower to 0.05 cent higher, with June at 48.80 cents a pound, and frozen pork bellies were 0.12 cent to 0.35 cent lower, with May at 51.35 cents a pound.

Crude oil futures fell sharply in early trading on the New York Mercantile Exchange amid pessimism about the ability of OPEC members to agree on production cuts, but the market recovered and settled nearly unchanged.

Oil ministers of the Organization of Petroleum Exporting Countries met Friday in Vienna to discuss an export-reduction proposal offered by six independent oil-producing countries.

Friday’s expiration of the May heating oil contract spurred light buying of heating oil futures late in the session, which helped support crude oil, said Jim Ritterbusch of Carson Petroleum Co., a Chicago-area oil distributor.

West Texas Intermediate crude oil settled 3 cents lower to 1 cent higher, with June at $17.99 a barrel; heating oil was 0.08 cent lower to 0.82 cent higher, with May at 51.79 cents a gallon, and unleaded gasoline was 0.05 cent to 0.16 cent lower, with May at 51.67 cents a barrel.