February 14, 2006

  

CBOT Soy Outlook on Tuesday: Flat-down 2 cents on South America forecasts

 

 

Soybean futures at the Chicago Board of Trade were called to open flat to down 2 cents per bushel Tuesday on forecasts for more rain in South America's soy belt later this week, brokers said.

 

CBOT soyoil futures were expected to slip following a larger-than-expected National Oilseed Processors Association oil stocks number of 2.057 billion pounds, while analysts saw a larger-than-expected NOPA January crush figure of 145.6 million bushels having little effect on CBOT soybean trade following the U.S. Department of Agriculture's recent downward revision in 2005-06 U.S. soy crush.

 

Firm gold markets early Tuesday and the possibility of fund buying in CBOT soybeans could temper losses, analysts said.

 

In overnight screen trade, the e-cbot March soybean contract settled down 1/2 cent at US$5.83 3/4 a bushel. March soymeal ended down 30 cents a short tonne at US$182.40, and March soyoil closed down 0.04 cent at 22.18 cents a pound.

 

A close above US$6.14 in the CBOT May soybean contract would provide the bulls with fresh upside technical momentum, a technical source said. A close below last week's low of US$5.85 would provide the bears with some fresh downside technical momentum.

 

First resistance for May soybeans was seen at US$6.00 and then at US$6.02--Monday's high. First support was seen at US$5.92 1/4--Monday's low-and then at US$5.90.

 

U.S. Midwest cash soybean basis bids were mostly steady to firm, cash dealers said.

 

Spot cash soybean bids were up 5 cents in St. Louis, steady in Sioux City, Iowa, and up 6 cents in Cincinnati, they noted.

 

Forecasts for Brazil's crucial soy growing area of Rio Grande Do Sol showed slightly increased chances for rains of 0.10 to 0.50 inch on Wednesday and Thursday, said Mike Palmerino, meteorologist at Meteorlogix weather service.

 

"But there is still cause for concern because Rio Grande Do Sol has sandy soils and needs rains about every 10 days," he said.

 

In Argentina, where good timely rains on Feb. 4-5 aided the crop, no rain and warmer temperatures were expected for the next 7 days, Palmerino said.

 

Soybean futures on China's Dalian Commodity Exchange settled slightly higher Tuesday in quiet trading, sources said.

 

The benchmark September 2006 soybean contract settled RMB7 higher at RMB2,738 a metric tonne; the most widely held May 2006 soymeal contract settled up RMB7 at RMB2,289/tonne; and the benchmark September 2006 soyoil contract rose RMB12 to settle at RMB5,077/tonne.

 

In Malaysia, crude palm oil futures on the Bursa Malaysia Derivatives ended higher Tuesday, extending the market's winning streak to a fourth straight day amid positive 2006 price outlooks, sources said. The benchmark April contract ended at MYR1,477 a metric tonne, up MYR10 from Monday.

 

In Rotterdam, spot soybeans were higher and soymeal prices were mixed, cash sources said.