March 26, 2009

 

CBOT Soy Outlook on Thursday: Seen up; outsides, crush, exports support

 

 

Soybean futures on the Chicago Board of Trade are poised for a higher start to Thursday's day session, buoyed by strength from outside markets and underlying fundamental support.

 

CBOT soybean futures are called 6 cents to 8 cents higher.

 

In overnight electronic trading, May soybeans were 8 3/4 cents higher at US$9.59 3/4. May soymeal was US$2.50 higher at US$296.80 per short tonne, while May soyoil ended 30 points higher at 33.67 cents per pound.

 

Broad-based strength in outside markets, with stock indexes, crude oil and metal futures higher coupled with weakness in the U.S. dollar expected to pull some speculative buying off the sidelines, a CBOT floor analyst said.

 

The outside support is seen easing some economic concerns and raising hopes that a near term low has been set and prices will begin to recover, he added.

 

Meanwhile, higher-than-expected crush data from the Census Bureau and supportive weekly export sales data is expected to provide fundamental strength to continue the firm overnight theme.

 

Lingering concerns about Argentina's farmers strike and its potential to shift some demand to U.S. shores is expected to provide price support as well.

 

However, position evening heading toward next week's plantings report and the uncertainty of the global economy will continue to promote cautious trade, a CBOT floor broker said.

 

Looking at technical charts, first resistance for May soybeans is seen at US$9.57 and then at Wednesday's high of US$9.71. First support is seen at Wednesday's low of US$9.48 and then at US$9.40.

 

Soy product futures are seen higher, in step with overnight action.

 

U.S. soybean crushings totaled 135.6 million bushels in February, according to data released by the U.S. Census Bureau Thursday. On average, analysts anticipated a 134.5-million-bushel crush, according to a Dow Jones Newswires survey. Crushings were down from 145.2 million bushels a month earlier and 144.4 million bushels a year earlier. Soymeal stocks for February totaled 434,714 short tonnes, compared to the average estimate of 435,000. Soyoil stocks totaled 3.027 billion pounds. Analysts, on average, expected 3.041 billion pounds.

 

The U.S. Department of Agriculture reported total weekly soybean export sales were a net 540,300 metric tonnes for the week ended March 19. Sales for 2008-09 were a net 428,800 metric tonnes. The primary buyer was China with 339,100 metric tonnes for delivery in the 2008-09 marketing year. Analysts had forecast sales between 250,000 and 550,000 metric tonnes.

 

Soymeal sales were a net 140,800 tonnes. Trade estimates ranged from 75,000 to 125,000 tonnes. Soyoil commitments were 49,800 metric tonnes. Analysts had forecast sales between 5,000 and 15,000 tonnes.

 

In overseas markets, China's soybean futures traded on the Dalian Commodity Exchange settled lower Thursday, following weakness at CBOT and crude oil prices Wednesday. Crude palm oil futures on Malaysia's derivatives exchange ended higher Thursday tracking gains in crude oil and soybean oil futures.