May soybeans were trading 25 1/4 cents higher late in the overnight session. China futures were up 0.6% overnight. Palm oil futures in Malaysia closed up 1.4% overnight. Equity markets in Asia were mixed overnight, with Hong Kong prices weaker and the Shanghai market tracking higher off rumors that the Chinese government might be poised to provide some fresh support to their housing sector. European markets were a little higher to start today, as UK GDP data provided a distraction to recent Euro zone debt issues. The US stock markets were showing definitive gains early this morning off supportive earnings from Apple last night and perhaps because of hope for something helpful from the FOMC later today. The US economic report slate today has an Advanced Durable goods result early that is generally expected to be higher and that report will be followed later on by a Fed Press Conference and the usual Fed statement release. The tightening supply outlook with further declines from Argentina this week and concerns that the US will not see high enough planted area to fulfill the surge in demand due to the smaller South America crop has helped to drive the market to new highs overnight. Relief that the mad cow case in the US did not occur due to poor feeding practices was an added boost overnight. More talk of a smaller South America crop due to lower production estimates from key forecasters and concerns that Argentina could slow the crush pace ahead helped support strong gains in soybeans and meal early yesterday. Spain bio-diesel demand is uncertain and this could cause crush margins in Argentina to falter and this has helped support meal. News of potential frost damage to the Argentina Buenos Aires region with lows down to 26 degrees added to the positive tone. The extent of losses will not be known for several days. Talk that meal offers from Argentina for August and beyond are difficult to come by helped to support. May meal surged higher and led the rally in the complex with nearby meal pushing to 422.80 overnight, the highest level since July of 2009 and up 9.4% from last week's lows. South Korea seeks up to 140,000 tonnes of soybean meal for arrival in September and October. The Philippines bought 80,000 tonnes of US meal for June-July shipment and traders believe that this business would normally come from Argentina. South Korea also seeks 25,000 tonnes of non-gmo soybeans. July soybeans closed sharply higher on the session yesterday and managed to push to a new contract high. July soybeans are now up as much as 87 1/4 cents from last week's lows. Stats Canada pegged canola planted area at 20.4 million acres which was slightly below trade expectations but up 8% from last year. Late weakness in the other grains helped pull the market off of the highs into the close.
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