January 8, 2008

 

CBOT Soy Outlook on Tuesday: 6-8 cents higher, following overnight gains

 

 

Chicago Board of Trade soybean futures are predicted to start day session trading 6-to-8 cents higher Tuesday as follow through buying from the overnight session and speculative buying are expected to underpin prices at the opening, an analyst said.

 

In overnight e-CBOT trading, March soybeans ended 7 3/4 cents higher at US$12.57 1/2 per bushel. March E-CBOT volume was 6,090 contracts.

 

Soybeans had good gains in the overnight session and should trade higher at the opening, an analyst said. In addition, crude oil is sharply higher and gold and silver are stronger as it appears that speculative money wants to "own" commodities Tuesday, the analyst added.

 

Moderating weather forecasts for Argentina might provide additional support, a trader said. Although rain is still forecast for Thursday, the amounts expected have been trimmed the trader said. In addition, with the U.S. Department of Agriculture scheduled to release crop production and stocks data, selling interest is modest, the trader said.

 

Dry conditions with only a few light showers are expected through Wednesday in Argentina, DTN Meteorlogix Weather said. Scattered showers and thunderstorms with amounts of 0.25-to-1.00 inch with locally heavier amounts possible on Thursday. Temperatures are forecast above normal through Wednesday with highs in the 90 degrees Fahrenheit range before turning cooler to near-to-below normal readings Thursday and Friday, Meteorlogix Weather said.

 

On daily technical charts, March soybeans closed lower and nearer the session low Monday on profit taking, a technical analyst said. Soybean bulls still have the technical advantage with some traders looking ahead to Friday's USDA reports. The next upside price objective for bulls to push prices above US$12.68 1/2 per bushel with the next downside objective pushing prices below solid technical support at US$12.18, which would fill on the downside an upside price gap on the daily bar chart. First resistance for March soybeans is seen at US$12.59 1/2, Monday's high and then at US$12.68 1/2. First support is seen at Monday's low of US$12.47 and then at US$12.36.

 

Deliveries posted against the CBOT January soybean contract were 555 contracts Tuesday. Large issuers included the customer account of Kottke, which issued 188 contracts and the house account of ADM Investor Services, which issued 164 contracts. Stoppers included the house account of Tenco, which stopped 116 contracts and the customer account of Man Professional Clearing, which stopped 252 contracts. The last trade date assigned was Jan. 7.

 

In overseas markets, crude palm oil futures settled lower on profit-taking, market participants said. The benchmark March contract on the Bursa Malaysia Derivative Exchange ended down MYR27 at MYR3,161/tonne.

 

In other soybean news, China plans to import 1.1 million metric tonnes of soybeans and 73,000 tonnes of soyoil in an effort to curb rising domestic prices, a person familiar with the situation said Tuesday.

 

Soybean futures on China's Dalian Commodities Exchange closed lower on the news of increased supplies. The March contract fell RMB/8 to RMB 4,730 per metric ton.