March 24, 2006

 

Friday: China soybean futures up, lgnores bird flu; corn up

 

 

Soybean futures on China's Dalian Commodity Exchange settled higher Friday on bargain hunting, as the market seemed impervious to news of Shanghai's first suspected human death from bird flu, analysts said.

 

A 29-year-old migrant worker who died from an unidentified type of pneumonia on Tuesday in Shanghai may have succumbed to bird flu virus, the official Xinhua News Agency reported late Thursday, citing the Shanghai Municipal Health Department.

 

"The news didn't change some speculators' expectations of a more favorable market situation," said Gao Yanrong, an analyst with Dalu Futures Co.

 

Market talk that soymeal sales have started to pick up since Wednesday in Shandong, a major poultry raising province, convinced some investors that bird flu will be controlled in spring, in line with what a government official said earlier this week, Gao said.

 

"However, most investors are still not clear about the market's direction, and some think fundamentals won't change quickly," he added.

 

The benchmark September 2006 soybean contract rose RMB8 to settle at RMB2,682 a metric tonne, after trading between RMB2,675/tonne and RMB2,688/tonne.

 

Trading volume for all soybean contracts rose to 52,560 lots from 40,530 lots Thursday.

 

Total open interest rose 10,308 lots to 279,726 lots.

 

One lot equals to 10 tonnes.

 

No. 2 soybean contracts, which are encouraged to be delivered with soybeans harvested from genetically modified crops, settled higher.

 

The benchmark September contract rose RMB4 to settle at RMB2,583/tonne.

 

Soymeal futures settled mostly higher on fresh buying. The benchmark September 2006 soymeal rose RMB10 to settle at RMB2,286/tonne.

 

Total open interest rose 4,312 lots to 376,532 lots.

 

Soyoil futures settled mostly higher, along with soybeans and soymeal. The benchmark September 2006 contract settled RMB19 higher at RMB5,171/tonne.

 

Corn futures settled slightly higher. The most widely held September 2006 contract settled RMB1 higher at RMB1,403/tonne.

 

"Corn still needs some time before a rebound, and will need confirmation from the cash market that animal feed consumption has risen substantially," Gao said.