February 16, 2007

 

Friday: China soybean futures settle up on CBOT; limited stocks

 

 

Soybean futures traded on China's Dalian Commodity Exchange settled higher Friday, tracking gains in soybean contracts on the Chicago Board of Trade.

 

The most active September 2007 contract settled RMB24 higher at RMB3,186 a metric tonne.

 

Total trading volume rose to 121,348 lots from 77,104 lots Thursday. One lot is equivalent to 10 tonnes.

 

"The buyers are very confident about soybean's long-term upward trend," despite possible risks during the Lunar New Year holiday when CBOT is open, said an analyst.

 

The Dalian Commodity Exchange will be closed next week for the holiday, which begins on Feb. 18.

 

CBOT soybean futures set new contract highs overnight amid fund and technically-led speculative buying.

 

Farmers only have 15%-20% of their harvest left, making the supply tighter, he said.

 

Analysts and traders said the soybean output is unlikely to be large this year, as has been the case for the past three years, and also because of likely reduced acreage under cultivation.

 

Soymeal and soyoil contracts settled mostly higher.

 

The most active September soymeal contract settled RMB28 higher at RMB2,672/tonne, while the benchmark May 2007 soyoil contract settled up RMB8 at RMB6,490/tonne.

 

Soymeal is mostly made from crushing imported soybeans, whose prices are much higher than domestic prices.

 

Corn futures settled mostly higher on bargain hunting, with the benchmark September corn contract settling RMB8 higher at RMB1,700/tonne.

 

Trading volume for corn contracts totaled 170,406 lots compared with 298,394 lots Thursday.

 

But corn prices may be under pressure after the Lunar New Year on less demand from the feeding sector, said analysts.

 

Corn and soymeal can be used as animal feed.