March 15, 2006

 

CBOT Soy Outlook on Wednesday: Flat-down 1 cent following e-CBOT

 

 

Soybean futures at the Chicago Board of Trade were called to open flat to down 1 cent per bushel Wednesday following weak overnight trade after Tuesday's gains, brokers said.

 

The building harvest and marketing of a projected record South American soy crop was expected to keep CBOT soy prices under pressure, along with ideas of improved U.S. Midwest planting conditions ahead of next month's seedings, brokers said.

 

Still, overseas markets were mixed, with Rotterdam soy prices higher, Malaysian palm oil prices weak and Chinese soy futures prices mixed, they noted.

 

In overnight screen trade, the e-cbot May soybean contract settled down 1 1/4 cents at $5.86 1/2 a bushel. May soymeal ended down 50 cents a short tonne at $175.60, and May soyoil closed down 0.07 cent at 23.60 cents a pound.

 

CBOT May soybeans remain in the lower third of the trading range, and for now the short-term technical bias is neutral, a technical source said.

 

Major resistance for CBOT May soybeans lies far overhead and the bulls have a long way to go before turning the short-term technical picture to the positive camp.

 

Initial resistance for CBOT May soybeans comes in at $5.96 and then another ceiling lies at the $6.07 1/2 area. However, gains would be needed above the $6.14-$6.17 zone before the bulls could regain control of the technical trend. On the downside, traders should continue to monitor action near support at $5.81 and $5.79 carefully.

 

Thursday is the last day to deliver against CBOT March soy futures.

 

There were 276 deliveries posted Wednesday against expired CBOT March soybeans, with a customer of R.J. O'Brien stopping 174 lots, brokers noted.

 

CBOT soybean registrations as of late Tuesday fell to 3,718 from Tuesday's 3,785 lots.

 

There were 26 deliveries posted Wednesday against expired CBOT March soyoil, with a customer of Banc of America stopping 16 lots. There were 24 soymeal deliveries posted, with the house account for Bunge Grain stopping all 24 lots.

 

CBOT soyoil registrations as of late Tuesday totaled 6,458 contracts while soymeal registrations remained steady at 34 lots.

 

U.S. Midwest cash soybean basis bids were mostly steady to firm, cash dealers said. Spot cash soybean bids were up 4 cents in Peoria, up 4 cents in St. Louis, and up 2 cents in Cincinnati, they noted.

 

At China's Dalian Commodity Exchange, soybean futures settled mixed Wednesday as overnight gains in soybean futures on the Chicago Board of Trade kept local speculators to the sidelines, sources said. The benchmark September 2006 soybean contract settled RMB7 higher at RMB2,696 a metric tonne.

 

The DCE September 2006 soymeal contract rose RMB8 to settle at RMB2,309/tonne, after trading between RMB2,301/tonne and RMB2,317/tonne; and the DCE September 2006 soyoil contract settled at RMB5,229/tonne, up RMB12.

 

In Malaysia, crude palm oil futures on the Bursa Malaysia Derivatives ended slightly lower Wednesday after a choppy trading day, with bearish sentiment amid concerns about high stocks keeping the market under pressure.

 

The benchmark May CPO contract ended at MYR1,437 a metric tonne, down MYR2 from Tuesday. In Rotterdam, spot soybean and soymeal prices were higher, cash sources said.