January 31, 2008

 

Thursday: China soybean futures settle almost unchanged; edible oil up

 

 

Soybean futures traded on the Dalian Commodity Exchange settled almost unchanged Thursday in quiet trade.

 

The benchmark September 2008 soybean contract settled unchanged at 4,665 a metric tonne.

 

High soybean and soyoil prices somewhat helped to curb consumption but the impact could be limited as substitutes for soyoil, such as lard, are also in tight supply, said Li Honglei, an analyst at Nanhua Futures.

 

China's clogged transportation systems amid snow storms also supported soybean prices as crude oil, coal and major grains such as paddy and corn will get priority in being delivered from north to south.

 

The State Council, the country's Cabinet, said late Wednesday "it is increasingly difficult to guarantee balanced supply and demand for agricultural products" due to limited resources and comparatively low profits in the agricultural sector.

 

Heavy snowfall has seriously affected oilseeds production but has so far left winter wheat largely untouched, said Chen Xiwen, deputy director of the State Council's Leading Group on Financial Reforms and top official for agricultural issues, Thursday.

 

The heaviest snow, rain and frost in five decades first struck central and southern China - the main areas for growing winter wheat and rapeseed - more than two weeks ago.

 

Domestic agricultural products prices need to be capped at reasonable levels, as the high prices don't necessarily help rural incomes due to increasing costs for inputs such as raw materials, said Chen.

 

Palm oil futures and soyoil futures settled higher while soymeal futures and corn futures settled down on sluggish demand for feedmeal.

 

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

 

               Contract      Settlement Price  Change     Volume

Soybean  Sep 2008      4,665         Unchanged     412,568

Corn       Sep 2008      1,744         Dn     5          261,456

Soymeal  Sep 2008      3,262         Dn    27         592,226

Palm Oil  May 2008      9,778         Up     20         33,628

Soyoil     May 2008     10,964         Up    54         282,078