March 23, 2006

 

CBOT Soy Review on Wednesday: Settles firm on light speculative buying

 

 

Chicago Board of Trade soybean futures ended firm Wednesday on light speculative buying, brokers said.

 

Gains were limited by losses in nearby CBOT corn futures, good U.S. spring soy planting prospects and forecasts for a record U.S. soy carryover, despite this week's talk of slightly reduced estimates for the 2006 South American soy crop, they added.

 

"Trade is really slow and I expect it could remain that way until USDA's report at the end of the month," one CBOT floor broker said.

 

The U.S. Department of Agriculture is scheduled to report on March 31 its 2006 prospective U.S. spring plantings and quarterly (March 1) stocks data.

 

CBOT brokers said Wednesday they expected the USDA to forecast on March 31 an increase of only 750,000 to 1 million acres to soybeans.

 

Early winter forecasts had called for an increase of 1 million-2 million U.S. soy acres this spring at the expense of corn, but firming CBOT corn prices at winter-end, bullish ethanol demand and recent U.S. Midwest rains have decreased the estimates.

 

U.S. 2005 soy seedings totaled 72.142 million acres, while the USDA in February at its annual outlook conference forecast 2006 U.S. soybean plantings would total 74 million acres.

 

In comparison, U.S. 2004-05 soybean plantings totaled 75.208 million acres, while 2000-2003 U.S. soy plantings ranged from 73.963 million (2003-04) to 74.266 million (2000-01) acres.

 

CBOT May soybeans ended on Wednesday up 1 3/4 cents at US$5.77 per bushel.

 

CBOT May soymeal closed up US$1.20 at US$175.30 per short tonne, the 20-day moving average, after topping its 10-day moving average.

 

CBOT May soyoil settled up 0.05 cent at 22.88 cents per pound, above its 100-day moving average but just below its 50-day moving average.

 

In CBOT soybean futures pit trade, funds were light net buyers Wednesday, brokers said. O'Connor and Co. bought 300 May; Rand Financial bought 400 May; ABN Amro bought 300 May and 200 November; and DT Trading sold 200 May, they noted.

 

Commercial FC Stonnee bought 200 July and 100 May while ABN Amro spread 400 July/May, they added.

 

CBOT South American soybean futures also ended firm Wednesday. The CBOT SAS May futures settled up 2 cents at US$5.98 per bushel.

 

In the U.S., midday spot Gulf soybean basis bids firmed 1 cent while interior bids were mixed Wednesday, cash sources said.

 

U.S. oilseed analysts estimated the U.S. Census Bureau would report early on Thursday the U.S. February soybean crush at 135.8 million bushels, down from the January crush tally of 151.5 million bushels.

 

Census February soyoil stocks were forecast at 2.724 billion pounds, up 247 million pounds from 2.477 billion pounds in January.

 

Census February soymeal stocks were expected to total 281,300 short tonnes versus the January tally of 324,402 short tonnes.

 

CBOT traders also awaited Thursday's weekly U.S. soybean and soy product export sales data. They anticipated the USDA would report weekly soybean export sales of 300,000 to 500,000 metric tonnes; soymeal sales at 60,000 to 125,000 tonnes; and soyoil sales of none to 10,000 tonnes.

 

 

SOY PRODUCTS

 

CBOT soymeal futures ended firm Wednesday, with the nearby five contracts up US$1.10 to US$1.30 per tonne.

 

In CBOT soymeal trades, funds were light net buyers. Rand Financial bought 800 May; Man Financial bought 200 May; and Citigroup sold 200 May, brokers said. Commercial ADM bought 300 May and sold 200 July, while Bunge Grain sold a net 100 May, they said.

 

Spot cash U.S. soymeal offers were unchanged Wednesday, sources said.

 

Soyoil futures settled firm Wednesday, with the nearby five CBOT soyoil contracts up 0.05 cent to 0.14 cent per pound.

 

Gains were limited by a mixed close in Malaysian palm oil futures and a continued correction in the CBOT oil share, sources said.

 

In Wednesday's CBOT soyoil trades, commercials and funds were net buyers, brokers said. Commercial ADM bought a net 300 May and 100 July; Bunge Grain bought 300 May; and Term Commodities bought 100 May, they said.

 

In speculative fund trade, Man Financial sold 800 May; JP Morgan bought 400 May; Tenco Inc. bought 300 July; and I-Cap bought 500 May, brokers said.

 

CBOT May oil share ended Wednesday at 39.49% and the May crush was at 60 1/4 cents.