January 29, 2007

 

Monday: China soybean futures settle up; expectations of smaller crop

 

 

Soybean futures traded on China's Dalian Commodity Exchange settled mostly higher Monday on expectations that farmers would grow a smaller crop this year.

 

The most active September 2007 contract settled RMB11 higher at RMB3,075 a metric tonne.

 

Total trading volume fell to 60,554 lots versus 77,074 lots Friday. One lot is equivalent to 10 tonnes.

 

Farmers are expected to grow less soybeans and more corn this year due to high corn prices, said Xu Wenjie, an analyst at Tianma Futures Co.

 

But good weather conditions in South America has curbed the upward momentum of soybean prices, he added.

 

With the harvest season nearing an end, South America is expected to export a large volume of soybeans in March.

 

Prices of China's soybean futures had fluctuated in a small range over the past week, with a lack of fresh news to convincingly push prices in either direction.

 

Soyoil futures settled lower, while soymeal futures settled mixed.

 

The benchmark May 2007 soyoil contract settled RMB68 lower at RMB6,426/tonne.

 

The most active September soymeal contract settled RMB2 higher at RMB2,579/tonne.

 

Soyoil futures prices, currently at high levels, face the possibility of a further fall due to lower palm oil import prices, said analysts.

 

Corn futures settled higher, with the benchmark September contract settling RMB6 higher at RMB1,706/tonne.

 

Trading volume for corn contracts totaled 462,612 lots compared with 861,594 lots Friday.