Soybean meal hit a four-month high on October 28 as near-record meat prices spurred demand for animal feed to fatten hogs and chickens.
Futures rose as much as 6.1 percent to $399.80 per 2,000 pounds on the Chicago Board of Trade, the highest since June 23, before trading at $388.70 at 6:30 a.m. local time. Prices jumped 7.6 percent the previous day, the most since 2007.
Wholesale pork, chicken and beef prices have hit records in 2014, contributing to an October rally in soybeans, soybean meal and grains used to feed livestock.
“Meat and dairy producers need the product,” Richard Feltes, the vice president of research at R.J. O’Brien & Associates in Chicago, told Bloomberg. “Farmer selling of soybeans is less than both exporters and processors need, and that’s building a bid in the market to pry loose more bushels.”
In the two weeks ended October 24, soybean meal surged 13 percent, the most since late August 2013. The price hit a 33-month low of $295.10 on October 1.
Futures rose 3.3 percent in the previous week, the most since late May and the fourth consecutive gain, the longest run in 13 months.
Soybeans inspected for export increased 8.5 percent to 2.2 million metric tons in the week ended October 23 from a week earlier, the highest in 11 months, the U.S. government said.
The October rally in soybean and soybean meal prices pared losses spurred by the outlook for record-high U.S. oilseed output. The government has said that the crop will rise 17 percent to 3.927 billion bushels from last season.
Soybeans have dropped 20 percent this year and meal futures declined 6.7 percent.