March 2, 2006
CBOT Soy Outlook on Thursday: Down 1-2 cents following weak e-CBOT trade
Soybean futures at the Chicago Board of Trade were called to open down 1-2 cents per bushel Thursday following weak overnight trade as ample U.S. supplies and the building South American harvest weigh on prices, brokers said.
Weekly U.S. soybean export sales matched expectations, but were "nothing to write home about," said John Kleist, of Kleist Ag Consulting.
U.S. soybean export sales for 2005-06 marketing year for the week ended Feb. 23 totaled 367,400 tonnes while new-crop sales totaled 185,000 tonnes, according to the U.S. Department of Agriculture.
U.S. soymeal export sales for the 2005-06 marketing year totaled 91,900 tonnes, while 500 tonnes of 2006-07 U.S. soymeal were sold, the USDA said.
U.S. weekly soyoil sales for the 2005-06 year were 400 metric tonnes, the government said.
"South America('s harvest) is starting to ramp up," Kleist said. "We're getting into crunch time. We're going to have to start doing some competing here."
In Brazil, lingering rains were expected in parts of top producer Mato Grosso until March 15, ClimaTempo weather service forecast Wednesday. The forecast spurred concerns that wet weather could damage soybean quality, traders noted.
In neighboring Argentina, the 2005-06 soybean crop was said to be evolving well thanks to a downpour of fresh rain this week, climatologists said.
Lingering concerns about a drop in global soybean consumption amid the spread of a deadly bird flu strain were also noted, CBOT brokers said.
China's vice premier on Thursday forecast possible bird flu outbreaks and more human cases during the coming spring migratory season.
The prediction was based on a "comprehensive analysis," the official Xinhua News agency said, citing Vice Premier Hui Liangyu, speaking at a conference on prevention and control of the disease.
In overnight screen trade, the e-cbot May soybean contract settled down 1 1/4 cents at US$5.89 3/4 a bushel. May soymeal ended down 40 cents a short tonne at US$174.20, and May soyoil closed up 0.06 cent at 24.21 cents a pound.
A close in CBOT May soybeans below this week's low of US$5.81 would provide the bears with some fresh downside technical momentum, a technical source said. A close above psychological resistance at US$6.00 would provide the bulls with better upside technical momentum.
First resistance for CBOT May soybeans was seen at US$5.93 - Wednesday's high - and then at US$5.98 1/2 - this week's high, the source said. First support was seen at US$5.87 - Wednesday's low - and then at US$5.85.
There were 2,146 deliveries posted on Thursday against CBOT March soybeans, with Term Commodities stopping 955 lots, brokers said.
Soybean contracts registered with the CBOT for delivery purposes as of Wednesday afternoon were unchanged at 3,859 lots.
There were 764 deliveries posted Thursday against CBOT March soyoil, with Bunge Chicago stopping 265 lots and Term Commodities stopping 499 lots. No soymeal deliveries were posted Thursday.
There were 6,233 soyoil registrations, up from the previous day's 6,101, and 34 soymeal registrations, unchanged from Tuesday.
U.S. Midwest cash soybean basis bids were steady to firm Thursday, cash dealers said. Spot cash soybean bids were up 3 cents in Des Moines, Iowa, up 2 cents in Cedar Rapids, Iowa, and up 4 cents in Evansville, Ind., they noted.
At the Dalian Commodity Exchange, soybean futures settled mostly lower Thursday following losses in CBOT futures, brokers said. The benchmark September 2006 soybean contract settled RMB8 lower at RMB2,714 a metric tonne. September 2006 soymeal fell RMB12 to RMB2,329/tonne and September 2006 soyoil rose RMB25 to settle at RMB5,278/tonne.
In Malaysia, crude palm oil futures on the Bursa Malaysia Derivatives ended weak on profit-taking. The benchmark May CPO contract fell below the key MYR1,500-a-metric-tonne psychological level to end at MYR1,490/tonne, down MYR10 from Wednesday.
In Rotterdam, spot soybean prices were mixed and soymeal prices were weak, cash sources said.
