March 07, 2008

 

Friday: China soybean futures settle sharply down;speculators opt out

 

 

Soybean futures traded on the Dalian Commodity Exchange settled sharply lower Friday as speculative investors have been withdrawing funds from the market.

 

The benchmark January 2009 soybean contract settled RMB91 lower at RMB4,634 a metric ton.

 

Zhou Guomao, an analyst at Changjiang Futures, said that the fundamentals of the market haven't changed and that the current tumble and earlier surge are both overdone.

 

Speculative funds have been booking profits recently despite record-high crude oil prices overnight and weakness in the dollar, which are usually bullish for commodities.

 

The withdrawal of speculative money forced investors to sell the contracts to prevent further losses, and drove all vegetable oil futures to limit-down during the session.

 

"Investors (tend to) stay on sidelines as market deviate from (good) fundamentals," said Dong Shuangwei at Capital Futures.

 

Analysts expect the market to rebound next week once the panic selling subsides.

 

Palm oil futures, soyoil futures, soymeal futures and corn futures also settled lower.

 

Friday's settlement prices in yuan per metric tonne and volume for all contracts in lots (one lot is equivalent to 10 tons):

 

                 Contract       Settlement Price   Change     Volume

 

Soybean      Jan 2009               4,634          Dn    91         1,015,968

Corn           Sep 2008               1,844          Dn    24         1,064,352

Soymeal     Sep 2008               3,592          Dn   31          1,482,682

Palm Oil      May 2008             11,660          Dn  472               6,940

Soyoil         Sep 2008             12,720          Dn  528              60,086