March 25, 2010

 

CBOT Soy Outlook on Thursday: Seen up 2-4 cents after losses Wednesday

 

 

Soybean futures on the Chicago Board of Trade are expected to start Thursday's day session higher in a minor correction from Wednesday's declines.

 

CBOT soybeans are seen opening 2 cents to 4 cents higher.

 

Overnight, CBOT May soybeans were 4 1/2 cents higher at US$9.64 1/2 a bushel.

 

Outside market influences with a weaker U.S. dollar and firmer crude oil and metal futures in early trade are seen lending psychological support to prices, analysts said.

 

The impending U.S. Department of Agriculture planting intentions report will keep prices trading in a range, said Joe Victor, analyst with Allendale Inc.

 

Traders are looking to reduce risk exposure as the market makes its seasonal transition in focus to new-crop production prospects, he added.

 

Global economic uncertainties will keep attention on outside financial markets, as traders take a cautious approach in the absence of fresh market moving news.

 

Tight old crop ending stock estimates will continue to support nearby contracts, as traders are concerned that a hiccup in 2010 production could extend supply tightness into the 2010-11 marketing year.

 

Meanwhile, the Census February soy crush was neutral for soybean prices while a lower-than-expected weekly export sales figure was slightly bearish, Victor said.

 

Soymeal futures received supportive export sales data from USDA, but that will be offset by higher-than-expected meal stocks reported in the Census crush report, Victor said.

 

A technical analyst said the next downside price objective for May soybeans is pushing and closing prices below solid technical support at US$9.41. The next upside technical objective is pushing and closing May prices above solid technical resistance at the February high of US$9.85.

 

The amount of soybeans crushed in February was in line with industry expectations, according to data issued by the U.S. Census Bureau. The bureau says 158.3 million bushels were crushed, in line with the average of analyst estimates of 158.3 million. Soymeal stocks jumped to 700,463 short tonnes in February from 630,497 tonnes in January. Meal stocks came in below the average analyst estimate of 555,000 tonnes. The bureau says soyoil stocks were 3.293 billion pounds, compared to the average analyst estimates of 3.374 billion.

 

U.S. Department of Agriculture reported total weekly soybean export sales were a net 319,900 metric tonnes for the week ended March 18, with net sales of 273,400 tonnes reported for the 2009-10 marketing year. Analysts had forecast sales between 350,000 and 750,000 metric tonnes.

 

Soymeal sales were a net 215,200 tonnes. Trade estimates ranged from 75,000 to 175,000 tonnes. Soyoil commitments were a net 13,800 metric tonnes. Analysts had forecast sales between 5,000 and 15,000 tonnes.