January 4, 2007

 

CBOT Soy Outlook on Thursday: 4-6 cents lower on follow through weakness

 

 

Chicago Board of Trade soybean futures are predicted to begin trading 4-to-6 cents lower Thursday, on follow through weakness from Wednesday's losses and weakness in overnight trade, sources said.

 

In overnight e-CBOT trading, January soybeans ended 6 cents lower at US$6.63 1/4 per bushel and March fell 5 1/2 cents to US$6.76 1/2. e-CBOT volume in March was 3,236 contracts.

 

The market should see some follow through liquidation from Wednesday, a floor analyst noted. The funds began the new year taking profits and it could continue Thursday. There is a lack of fresh news out and the weather in South America remains favorable for oilseeds, he added.

 

The DTN Meteorologix weather forecast said widely scattered showers will maintain generally favorable conditions in Brazil over the next several days.

 

In Argentina, mostly dry weather with only a few light showers will continue to maintain good growing conditions for soybeans across central Argentina, Meteorologix said.

 

On day session open auction technical charts, March soybeans gapped open lower and closed near the session low, a market technician said. No major chart damage occurred however, additional selling could cause some near-term chart damage.

 

First resistance for March soybeans is seen at US$6.85 and then at US$6.91 1/2, Wednesday's high. First support is pegged at US$6.80 and then at US$6.75.

 

Deliveries posted against the January soybean contract totaled 120 contracts Thursday. The last trade date assigned was Dec. 27.

 

One thousand and nineteen delivery notices were posted against the January soy oil futures. Large issuers included the customer account of the LBS division of Man Financial, which issued 529 contracts. Large stoppers included the customer account of RJ O'Brien, which stopped 316 contracts. The last date assigned was January 3.

 

Deliveries posted against the January soy meal contract totaled 449 contracts. The house account of Bunge stopped 388 contracts. The last trade date assigned was Dec. 28.

 

Rotterdam soybean and soymeal prices were lower.

 

In overseas markets, Crude palm oil futures on the Bursa Malaysia Derivatives ended lower for the third straight session, dragged lower by losses in other commodities, analysts said. The March contract fell MYR43 at MYR1,919 per metric tonne.

 

Soybean futures on China's Dalian Commodity Exchange settled lower on broad commodity weakness and overnight losses in CBOT soybean futures, sources said.