January 22, 2009
Thursday: China soy futures edge lower; caution ahead of holiday
Soybean futures traded on the Dalian Commodity Exchange settled slightly lower Thursday, largely due to caution ahead of the Lunar New Year holiday, analysts said.
The benchmark September 2009 soybean contract lost RMB4, or 0.1%, to settle at RMB3,391 per metric tonne.
Analysts said soybeans may continue to trade in shrinking volume within recent ranges Friday - the final trading day before the holiday kicks off.
Market participants largely disregarded lingering concerns over Argentine weather, which could lend support to soybean prices, they said.
Trading volume of all soybean contracts rose to 294,056 lots from 298,356 lots Wednesday.
Opening interest fell 33,206 lots to 290,366 lots.
Corn, soymeal, soyoil and palm oil futures all settled higher.
"It's the holiday mood that leads market players to exit their positions as they don't want to take any risks home for the holiday," said Wang Xiaoguang, an analyst with Galaxy Futures.
The exchange adjusted the minimum margin for trading of soybean, soymeal, soyoil, corn, and palm oil contracts to 8% of the respective contracts' value from 7% starting Friday and continuing through Feb. 4..
The futures bourse usually makes such changes ahead of long holidays to mitigate risks of higher volatility due to movements on the Chicago Board of Trade while the Chinese market is closed.
Markets in China will be closed from Jan. 26-30 to mark the holiday.
Thursday's settlement prices in yuan a metric tonne for benchmark contracts and the volume for all contracts in lots (One lot is equivalent to 10 tonnes):
Contract Settlement Price Change Volume
Soybean Sep 2009 3,391 Dn 4 294,056
Corn May 2009 1,549 Up 1 40,646
Soymeal May 2009 2,665 Up 33 379,434
Palm Oil May 2009 5,214 Up 26 69,256
Soyoil May 2009 6,196 Unch 155,148
