March 19, 2009

China's soybean futures traded on the Dalian Commodity Exchange settled slightly higher Thursday, following the rise on the Chicago Board of Trade overnight.

 

The benchmark September 2009 soybean contract settled RMB14 a metric tonne higher at RMB3,522/tonne, or up 0.4%, after trading between RMB3,510 and RMB3,538/tonne during the session.

 

The rising cost of importing soybeans has helped to ease the downward pressure on prices from the upcoming crop of South American soybeans, said Xu Zhimou, an analyst at Ruida Futures Brokerage.

 

The cost of soybeans arriving at Chinese ports has risen 7%-8% from the start of this month, according to data from Tianqi Futures.

 

However, soybean prices will face more downward pressure in the coming weeks.

 

The U.S. Department of Agriculture is scheduled to issue a prospective plantings report March 31, which will offer additional ideas about U.S. grain and soy supply in 2009.

 

The market expects the report to raise its soybean acreage forecast significantly.

 

Meanwhile, the marketing of new South America soybeans in the coming months will pressure the prices as well, said analysts.

 

Trading volume of all soybean contracts declined to 226,906 lots from 249,588 lots Wednesday.

 

Open interest rose 1,080 lots to 326,268 lots Thursday.

 

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

 

Thursday's settlement prices in yuan a metric tonne for benchmark contracts and volume for all contracts in lots (One lot is equivalent to 10 tonnes):

                        

Contract        Settlement       Price        Change     Volume

Soybean        Sep 2009        3,522        Up   14     226,906

Corn             Sep 2009        1,717         Up    5     108,386

Soymeal        Sep 2009        2,657        Up   35     717,402

Palm Oil         Sep 2009        5,322        Up   62     163,526

Soyoil            Sep 2009        6,184        Up  104    636,930