March 15, 2007

 

Thursday: China soybean futures settle higher on technical rebound

 

 

Soybean futures traded on the Dalian Commodity Exchange settled mostly higher Thursday on a technical rebound.

 

The benchmark September 2007 contract rose RMB11 to settle at RMB3,207 a metric tonne.

 

Total trading volume declined to 84,342 lots from 151,482 lots Wednesday. One lot is equivalent to 10 tonnes.

 

"There is a lack of news to (guide the trade), and the market is likely to consolidate ahead of the March 30 planting report from the U.S. Department of Agriculture," said Xu Wenjie, an analyst at Tianma Futures Co.

 

There is widespread expectation that farmers will grow more corn at the expense of soybean this year, because corn prices have risen. This will in turn push soybean prices higher.

 

He expects the domestic soybean market to face downward pressure in the short term as supplies are expected to rise, with a large volume of South American soybeans expected to arrive in April.

 

Soymeal and soyoil futures settled mostly higher, along with soybean futures.

 

The benchmark September 2007 soymeal contract rose RMB7 to settle at RMB2,670/tonne. The benchmark September 2007 soyoil contract settled RMB22 higher at RMB6,530/tonne.

 

Traders said soymeal futures are under pressure as the recovery in the poultry sector isn't satisfactory.

 

Soymeal is used as animal feed.

 

Corn futures settled mostly higher. The benchmark September 2007 contract settled RMB5 higher at RMB1,695/tonne.

 

Trading volume for all contracts fell to 257,764 lots from 385,316 lots Wednesday.