Wednesday: China soy futures settle slightly up; market awaits cues

 

 

Soy futures on the Dalian Commodity Exchange settled slightly higher Wednesday as traders awaited further cues after Chicago Board of Trade soy failed to hold onto gains.

 

The benchmark September 2010 soy contract settled up RMB4 or 0.1% at RMB3,858 a metric tonne.

 

The contract opened slightly lower and consolidated within a tight range of RMB19/tonne during the session.

 

Rainfall in South America soy areas hasn't been able to support prices continuously, while a fluctuation in the dollar made the outlook unclear for the market, said analysts.

 

"CBOT soy are well under pressure at US$10 per bushel," said Tu Xuan, an analyst with commodities consultancy Shanghai JCI.

 

CBOT March soy ended 9 cents or 0.94% lower at US$9.52 1/2 Tuesday, while May soy settled 9 1/2 cents or 0.98% lower at US$9.59 1/2.

 

However, some analysts don't expect the market to fall much either, as they think prices have already bottomed out.

 

With all the negative factors, including an expected record harvest in South America, already factored in and prices not falling much, "then how much more can they fall?" said Hu Shengming, an analyst with Tianqi Futures.

 

Trading volume for all soy contracts declined to 240,154 lots from 386,584 lots Tuesday.

 

Open interest fell 8,450 lots to 357,870 lots.

 

Corn futures and soymeal futures settled little changed, while soyoil futures and palm oil futures settled a tad lower.

 

The following are Wednesday'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

Soy         Sep 2010      3,858        Up    4    240,154

Corn       Sep 2010      1,873        Up    1     38,378

Soymeal  Sep 2010      2,854        Up    2    899,690

Palm Oil  Sep 2010      6,962        Dn   10    312,010

Soyoil     Sep 2010      7,514        Dn   30    306,840