February 12, 2009

Soybean futures at the Chicago Board of Trade are expected to open Thursday's day session with a steady undertone, as the market is on hold awaiting fresh news to drive prices.

 

CBOT soybean futures are called steady to 2 cents lower.

 

In overnight electronic trading, March soybeans finished unchanged at US$9.78. March soymeal was US$1.70 higher at US$307.40 per short tonne, while March soyoil ended 2 points lower at 33.16 cents per pound.

 

The market is seemingly handcuffed, waiting to see what will come out of the U.S. stimulus program as well as updates on weather for South American crops, said Don Roose, president, U.S. Commodities in West Des Moines, Iowa.

 

However, "weekly export sales rebounded to big levels this week and that could provide early price support," Roose added.

 

Private weather forecasters have added some rain in longer range outlooks for Argentina, but traders say far out forecasts are less reliable. The trade will eye outside markets for guidance as well, with a weak early tone in crude oil futures and U.S. stock indexes poised for a lower start.

 

Otherwise, there is a quiet news front, opening the door for early position evening heading toward an extended 3-day holiday weekend. CBOT markets will be closed Monday for the U.S. Presidents Day holiday.

 

A market technician said the next upside price objective for March soybeans is to push and close prices back above solid technical resistance at this week's high of US$10.19 a bushel. The next downside price objective is pushing and closing prices below solid technical support at last week's low of US$9.34 1/2 a bushel.

 

First resistance for March soybeans is seen at Wednesday's high of US$9.96 and then at US$10.00. First support is seen at Wednesday's low of US$9.76 and then at US$9.70.

 

The U.S. Department of Agriculture reported total weekly soybean export sales were a net 1,069,200 metric tonnes for the week ended Feb. 5. Sales for 2008-09 were a net 1,068,700 metric tonnes. Analysts had forecast sales between 400,000 and 800,000 metric tonnes. The primary buyer was China with 724,300 metric tonnes.

 

Soymeal sales were a net 196,700 tonnes. Trade estimates ranged from 100,000 to 200,000 tonnes. Soyoil commitments were 45,900 metric tonnes, a marketing year high. Analysts had forecast sales between 25,000 and 50,000 tonnes.

 

The USDA also announced private exporters reported a daily export sale of 116,000 metric tonnes of Soybeans for delivery to China during the 2008/2009 marketing year Thursday.

 

The DTN Meteorlogix weather forecast said drier, hotter weather will again increase stress to Argentine crops during the next 5-7 days, especially in areas that missed the showers Tuesday. Long range charts are more promising for rain but these charts are less reliable than the short range, Meteorlogix added.

 

In overseas markets, soybean futures traded on the Dalian Commodity Exchange settled slightly higher Thursday, with prices trading in a very tight range as the market awaited more clear signs from CBOT. The benchmark September 2009 soybean contract settled RMB5 higher at RMB3,546 a metric tonne.

 

Crude palm oil futures on Malaysia's derivatives exchange ended a tad higher in thin, volatile trade as clashing cues caused uncertainty in the market, trade participants said Thursday. The benchmark April contract on the Bursa Malaysia Derivatives ended MYR3 higher at MYR1,928/tonne after hitting an intraday low of MYR1,907.