February 10, 2009
Tuesday: China soy futures flat; market cautious ahead of USDA report
China's soybean futures traded on the Dalian Commodity Exchange closed unchanged Tuesday as investors were cautious ahead of a key report to be issued by the U.S. Department of Agriculture later in the day.
The benchmark September 2009 contract closed at RMB3,580/tonne.
The USDA is scheduled to issue its February supply-and-demand report, with the market expecting reductions in South American soybean output and U.S. ending stocks.
The report is likely to be favorable for soybeans, but the market may sell off on the news, said analysts.
"Usually the market will sell once the positive news is confirmed, and soybean prices have been rising a lot after the Chinese New Year holiday," said Yuan Jianbin, an analyst with Guangfa Futures.
He said traders were taking profit and cutting positions to avoid risks.
On Wednesday, China customs is scheduled to release the trade data of major commodities for January. Analysts expect soybean imports to be far above 3 million tonnes on cheaper prices and freight rates in earlier months.
The traded volume of all soybean contracts fell sharply to 296,698 lots from 573,550 lots Monday. Open-interest positions fell 3,388 lots to 307,948 lots.
Corn futures and soymeal futures settled lower, while soyoil futures and palm oil futures settled higher.
The current domestic drought has hit crop regions, with most of the affected areas involving wheat.
Analysts said that some rapeseed crop has also been affected, although the impact is limited. Still, vegetable-oil futures prices have moved higher in recent sessions.
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
Soybean Sep 2009 3,580 Unchanged 296,698
Corn Sep 2009 1,649 Down 4 67,610
Soymeal May 2009 2,834 Down 8 556,424
Palm Oil May 2009 5,524 Up 72 187,550
Soyoil May 2009 6,572 Up 62 532,352
