U.S. soybean futures are poised for a higher start Monday, underpinned by inflationary concerns and spillover support from soaring grain futures.
CBOT soybeans are seen opening 3 cents to 5 cents higher.
In overnight trading, Chicago Board of Trade May soybean futures were up 4 1/2 cents at $13.85 a bushel, the most-active July contract was up 4 1/2 cents at $13.94 1/4, and new-crop November futures were up 2 cents at $13.84 1/2.
The strength in outside markets will lend support to prices, with buyers emerging as many investors trade grain and oilseed futures in a basket of commodities.
The market has been pulled slightly higher by strength in corn and wheat, with inflationary concerns supportive as gold and crude oil are trading higher while the dollar index is lower, according to a Doane Advisory Service market note.
Despite a firmer tone, futures are not expected to climb as much as corn and wheat futures, as record harvests in South America cool demand for U.S. exports. Freshly harvested South American supplies take away the urgency to curb U.S. usage.
China, the leading importer of U.S. and global soybeans, has slowed its purchasing, as China's soybean demand is reportedly sluggish with port inventories high and inventories at crushing plants at comfortable levels.
Chinese buyers are canceling deals due to negative crushing margins after having made heavy purchases at the start of the year that began Oct. 1, Jay O'Neil, senior agricultural economist at Kansas State University, said on the sidelines of a conference organized by the American Soybean Association-International Marketing.
Chinese buyers will likely import 53 million to 54 million metric tons of soybeans in 2010-11, down from earlier expectations of 57 million tons, he added.
The trade is also focused on planting weather, as cool, wet Midwest conditions pose a threat to early corn seedings, which could possibly shift some corn acreage to soybeans. Earlier corn planting is typically better for final yields, as it reduces the chance the crop will still be developing when the season's first frost hits.
The Telvent DTN weather forecast said heavy rains and storms through the eastern and southern Midwest and Delta region during the weekend and early this week likely means severe flooding and little chance for field work or corn planting this week. The conditions are not as wet to the north and west, but cooler soil temperatures in these areas may also limit field work during the week, Telvent added in the forecast.
On tap for Monday, the U.S. Department of Agriculture is scheduled to release its weekly export inspections report at 11 a.m. EDT and its weekly crop progress report at 4 p.m. EDT.
-Sameer Mohindru contributed to this article