March 8, 2007

 

Thursday: China soybean futures settle mostly up on CBOT; corn lower

 

 

Soybean futures traded on the Dalian Commodity Exchange settled mostly higher Thursday on overnight gains in the Chicago Board of Trade soybean futures, although consolidation is likely to be the theme for some time, analysts said.

 

The benchmark September 2007 contract settled RMB15 higher at RMB3,224 a metric tonne, after trading between RMB3,217/tonne and RMB3,231/tonne.

 

Total trading volume rose to 139,388 lots from 119,504 lots Wednesday. One lot is equivalent to 10 tonnes.

 

"Investors remained cautious in the session, being hesitant in tracking overnight gains, as a USDA report is due tomorrow," said Zhang Yifan, an analyst at China Grains & Oils Group Feed Corp.

 

Given the strong gains in CBOT soybean futures November to February, traders said there is pressure for a downward correction in the coming month.

 

"Technically, CBOT soybeans are biased up, but the fundamentals aren't that supportive, in view of plentiful supply, and prices may feel the pressure in April," said an analyst in Beijing.

 

Dalian's soymeal and soyoil futures settled mostly higher, along with soybeans.

 

The benchmark September 2007 soymeal contract gained CN7 to settle at RMB2,698/tonne.

 

The benchmark September 2007 soyoil contract settled RMB18 higher at RMB6,492/tonne.

 

"Higher prices of soybean imports have led to gains in soyoil prices recently, instead of demand, therefore, downward pressure is seen along with a correction in CBOT soy futures," Zhang said.

 

Dalian's corn futures settled lower in line with overnight losses in CBOT corn futures. The most active September 2007 contract fell RMB4 to settle at RMB1,697/tonne.

 

Their near-term outlook remains unclear, and is vulnerable to sharp changes in crude oil prices, if any, the analyst in Beijing said.