Wednesday: China soy futures settle up; market awaits US planting data

 

 

Soy futures traded on the Dalian Commodity Exchange settled higher Wednesday, amid broad gains in base metals futures and equities.

 

The benchmark September 2010 soy contract settled up RMB28, or 0.7%, at RMB3,848 a metric tonne.

 

In the absence of directional cues from supply-and-demand fundamentals, Dalian soy are likely to trade within recent ranges for the next couple of weeks, analysts said.

 

"Funds in agricultural futures have recently been diverted to other commodities, such as metals, so it's very likely that we'll see light trading and little price movement in the coming sessions," said Gao Yanrong, an analyst with Dalu Futures.

 

Gao tipped Dalian soy to move in a RMB3,700-RMB3,900/tonne range on chart-based cues.

 

A broad rise in metals futures provided a lift for agricultural products. Concerns over a further tightening of monetary policy in China continued to ease, and dollar weakness after the US Federal Open Market Committee's confirmed Tuesday that it will keep interest rates low for an extended period also helped support metals, analysts said.

 

Looking ahead, analysts said market participants will look for cues from data on US planting area due at the end of March.

 

The trading volume of all soy contracts declined to 205,422 lots from 233,728 lots Tuesday.

 

Open interest fell 3,706 lots to 358,302 lots Wednesday.

 

Corn, soymeal, soyoil and palm oil futures all settled higher.

 

The following are Wednesday's settlement prices in yuan a tonne for benchmark contracts and volume for all contracts in lots (one lot is equivalent to 10 tonnes):

 

Product   Contract    Settlement Price  Change     Volume

Soy        Sep 2010      3,848         Up  28     170,430

Corn       Sep 2010      1,898         Up   5      44,064

Soymeal  Sep 2010      2,800         Up  26     725,426

Palm Oil   Sep 2010      6,900         Up  66     328,958

Soyoil      Sep 2010      7,502         Up  50     356,080