February 1, 2008

 

CBOT Soy Review on Thursday: Mixed in choppy, light volume trade

 

 

Chicago Board of Trade soybean futures ended mixed Thursday, chopping around looking for direction in two-sided, low volume action.

 

March soybeans ended 1 1/4 cents lower at US$12.74 1/2, July soybeans finished unchanged at US$13.07 1/4 and November soybeans ended 16 1/4 cents higher at US$12.45 1/2. March soymeal settled US$1.20 lower at US$341.50 per short tonne. March soyoil finished 26 points higher at 53.72 cents per pound.

 

"With volume on the light side, there was a lack of conviction among traders to aggressively push prices in either direction," said John Kleist, analyst with Kleist Ag Consulting.

 

The market was searching for favorable news to extend recent gains, but with a quiet news front and improved South American weather, the market struggled to rekindle bullish momentum, analysts said.

 

However, a bounce in both wheat futures and the U.S. stock market coupled with a lack of aggressive selling to extend early losses, but futures managed to find their footing after prices fell to technical chart support, Kleist added.

 

A technical trader said March futures broke below the trendline support created over the last five up days and closed lower as momentum stalled.

 

Meanwhile, new-crop futures ended firmly, rallying in step with new-crop corn amid its need for prices to battle for spring acres, Kleist said.

 

Otherwise, activity was subdued, with profit-taking on bull spreads and ideas export demand may taper off in the next couple of weeks as Asian buyers exit the market for the Lunar New Year Holidays limiting nearby price movements, analysts added.

 

The DTN Meteorlogix weather forecast said South American crop conditions remain mostly favorable from a weather standpoint through the balance of this week. In Brazil, showers through the southern belt look to be light while the north continues to see moderate to heavy thunderstorms. The rains in the north are becoming somewhat of a concern for maturing soybeans and the early harvest; however, no significant harvest delays have yet been reported, Meteorlogix reported.

 

Argentina's central crop areas had scattered showers and cooler temperatures during the past week or so -- helping to ease stress to crops. Thursday's short-range weather maps feature a new cold front for Saturday that was not on the maps Wednesday, Meteorlogix said. This means a chance of showers and additional cooler weather during the next week, the forecast added.

 

In pit trades, buyers and seller were scattered among various commission houses, with speculative funds estimated net sellers on the day.

 

 

SOY PRODUCTS

 

Soy product futures ended mixed, with the adjusting of meal/oil spreads featured. Soyoil futures finished higher, managing to shake off the bearish influence of weak crude oil prices on the realization of strong export demand following higher-than-expected weekly export sales, analysts said.

 

Soymeal futures ended mixed, with nearby futures lower versus deferred month contracts. The market received bullish weekly export sales data, but the news was offset by the soyoil demand strength, which encouraged some unwinding of meal/oil spreads, analysts said.

 

March oil share ended at 44.03% and the March crush ended at 67 3/4 cents.

 

In soymeal trades, buyers and seller were scattered among various commission houses, with speculative funds estimated net sellers on the day.

 

In soyoil trades, buyers and seller were scattered among various commission houses.