March 13, 2007
Tuesday: China soybean futures settle mostly up on CBOT gains; corn up
Soybean futures traded on the Dalian Commodity Exchange settled mostly higher Tuesday on the heels of overnight gains in Chicago Board of Trade soybean futures.
The benchmark September 2007 contract settled RMB12 higher at RMB3,217 a metric tonne, after trading between RMB3,213 and RMB3,223/tonne.
Total trading volume rose to 106,994 lots from 89,408 lots Monday. One lot is equivalent to 10 tonnes.
"Dalian's soybeans will probably continue to consolidate in the short-term, but in one or two months, they're likely to gain the momentum to rise," said Li Honglei, an analyst at Nanhua Futures Co.
"Farmers have sold almost all their stocks, and domestically grown soybeans will see tight supply," although a large amount of imports may continue to exert pressure, Li said.
China's soybean imports in January-February rose 29% on year to 3.61 million tonnes, and participants expect imports to remain strong in March and April.
Dalian's soymeal and soyoil futures settled mostly higher, along with soybean futures.
The benchmark September 2007 soymeal contract rose RMB9 to settle at RMB2,690/tonne, while the benchmark September 2007 soyoil contract settled RMB48 higher at RMB7,830/tonne.
Dalian's corn futures settled mostly higher on the spillover effect from soy futures, along with a rollover from the May contract to the September contract, analysts said.
However, they added sufficient domestic supply and sluggish buying will likely lead to a downward correction soon.
The benchmark September 2007 contract gained RMB6 to settle at RMB1,690/tonne.
Trading volume for all contracts rose to 545,086 lots from 389,338 lots Monday.
"Corn processors are not keen to buy at the moment, as they are using their previous stockpiles," said Xu Yulan, an analyst with Yong'an futures.
If prices in Jiling and Heilongjiang provinces can't stay at high levels, futures prices will lack supportive factors, Xu said.
