February 13, 2008

 

Wednesday: China soybean futures settle down a tad on demand concerns

 

 

Soybean futures traded on the Dalian Commodity Exchange settled slightly down Wednesday on expectations of shrinking demand after the Lunar New Year holiday.

 

The benchmark September 2008 soybean contract slipped RMB25 to settle at RMB4,806 a metric tonne, after trading between RMB4,789/tonne and RMB4,830/tonne.

 

"Usually, the demand for soybeans and soymeal shrinks over the one or two months after the Chinese New Year, because of less demand for feedmeal" as pigs are culled ahead of the week-long holiday, said Dong Liang, an analyst at Jiuheng Futures.

 

Analysts said the phenomenon may be particularly pronounced this year, as freezing temperatures in the south before the holiday proved fatal for many pigs and poultry, resulting in even lower demand.

 

Soymeal futures settled down in tandem with soybeans.

 

Soyoil, however, gained sharply as analysts speculated that the freezing weather earlier may have affected the production of rapeseed oil, thus decreasing supply.

 

There have been no government reports on the extent of the impact yet.

 

Corn futures settled slightly down, also on concern there will be lower demand for feedmeal over the next few weeks.

 

Corn is mainly used in animal feed production in China.

 

Wednesday's settlement prices in yuan a metric tonne and volume for all contracts in lots:

 

               Contract      Price        Change     Volume

Soybeans  Sep 2008      4,806      Dn  25     405,164

Soymeal   Sep 2008      3,347       Dn  28    322,868

Soyoil       May 2008     11,542      Up 200    259,794

Corn         May 2008      1,768      Dn  11    276,800

Palm Oil    May 2008     10,292      Up 158     46,300