Tuesday: China soy futures inch down on weather concerns, CBOT

 

 

Soy futures edged lower on the Dalian Commodity Exchange Tuesday, weighed by losses on the Chicago Board of Trade, weather concerns in South America and seasonally weak demand.

 

The benchmark September soy contract settled down marginally at RMB3,904 a metric tonne.

 

"The CBOT is low, and at this time of year, we traditionally see the lowest prices for soy of the first half of each year," said Li Honglei, analyst with Nanhua Futures.

 

Domestic demand usually weakens during this time of the winter, before ramping up for the Lunar New Year, Li said.

 

CBOT soy futures also dropped to their lowest point in nearly four months Monday on a bearish outlook for South American crops and technical selling.

 

The prospects for record South American crops have increased with improving weather, threatening to raise global soy supplies, Li said.

 

"But in Argentina, drought-like conditions might return, so it's not a certainty," he said.

 

Argentina accounts for about a tenth of China's soy imports.

 

Trading volume on the DCE for all soy contracts rose to 478,104 lots from 343,742 lots Monday.

 

Open interest rose 2,544 lots to 345,988 lots.

 

Corn, soyoil, soymeal and palm oil futures fell Tuesday.

 

Tuesday's settlement prices in yuan a metric tonne for benchmark contracts and volume for all contracts in lots (One lot is equivalent to 10 tonnes):

 

               Contract  Settlement Price  Change      Volume

Soy         Sep 2010      3,904        Dn    3       478,104

Corn       Sep 2010      1,863        Dn    8        87,626

Soymeal  Sep 2010      2,854        Dn   20      715,498

Palm Oil  Sep 2010      6,774        Dn   56       767,728