Soybeans Rise for First Time in Six Days; Declines Overdone

By William Bi

Aug. 7 (Bloomberg) -- Soybeans rose for the first time in six days on speculation the recent price slump was overdone and may prompt farmers to withhold grain. Corn and wheat also gained.

Soybean futures have plunged 12 percent this month, as favorable weather from the U.S. to China raised the prospect of a bigger-than-expected global crop this year. The soybean 14-day relative strength index, a gauge of momentum, has held below 30 since Aug. 5, signaling prices may rise. The futures reached a record $16.3675 a bushel on July 3.

``The recent fall may have been excessively amplified by the panicked withdrawals by speculators,'' Jin Jilai, vice-general manager of Yongan Futures Brokerage Co., said by phone from Hangzhou today. ``Farmers may not want to sell if prices slide further.''

Soybean futures for November delivery rose as much as 17 cents, or 1.4 percent, to $12.39, in after-hour electronic trading on the Chicago Board of Trade. It was at $12.3650 at 11:25 a.m. Beijing time. Still, soybeans are near the lowest in four months amid a global sell-off in commodities.

Corn futures for December delivery gained as much as 3 cents, or 0.6 percent, to $5.3075 a bushel and last traded at $5.2950. Yesterday, corn touched $5.2225, the lowest for a most-active contract since March 24.

December-delivery wheat rose as much as 0.9 percent to $7.9775 a bushel and last traded at $7.97.

To contact the reporter on this story: William Bi in Beijing at wbi@bloomberg.net