April 2, 2009

CBOT Soy Outlook on Thursday: Seen up on outside markets, export sales

Bullish outside market influences and higher-than-expected weekly export sales have Chicago Board of Trade soybean futures poised for a higher start to Thursday's day session.

CBOT soybean futures are called 15 cents to 20 cents higher.

The market is set to follow the firm overnight theme, with higher stock indexes and crude oil coupled with weakness in the U.S. dollar index promoting a bullish cause, said Vic Lespinasse, analyst with Grainsanalyst.com.

A weaker U.S. dollar makes U.S. exports less expensive to world importers.

Larger-than-expected weekly export sales puts another feather in the cap of market bulls, with no fresh bearish news and lingering nervousness about the future of Argentina exports aiding the supportive tone, Lespinasse said.

Meanwhile, traders are also eyeing Midwest weather conditions, as the amount of planted acreage to corn and soybeans will boil down to potential seeding delays or the lack of field work disruptions, a CBOT floor broker said.

Technically inspired activity will be featured as well, with traders looking for signs of follow through buying or the exhaustion of buying on early rallies for clues to near term direction.

On technical charts, first resistance for May soybeans is seen at Wednesday's high of US$9.59 3/4 and then at US$9.71. First support is seen at Wednesday's low of US$9.43 and then at US$9.30.

Soy product futures are seen higher, in tune with the overnight theme. Soyoil will benefit from strength in world vegoil markets, higher crude oil futures and solid weekly export sales.

The DTN Meteorlogix weather forecast said episodes of snow, rain and thunderstorms are on tap for the U.S. Midwest during the next 10 days. This likely means further delays for spring field work and any early planting. Snow over the western Midwest during the weekend will also mean problems for transportation, Meteorlogix said.

The U.S. Department of Agriculture reported total weekly soybean export sales were a net 1,180,900 metric tonnes for the week ended March 26. Sales for 2008-09 were a net 599,800 metric tonnes. Analysts had forecast sales between 350,000 and 625,000 metric tonnes.

Soymeal sales were a net 107,000 tonnes. Trade estimates ranged from 75,000 to 150,000 tonnes. Soyoil commitments were 62,000 metric tonnes. Analysts had forecast sales between 40,000 and 65,000 tonnes.

U.S. Census Bureau Thursday downwardly revised its February soyoil stocks estimate to 3.018 billion pounds, down from its preliminary estimate of 3.027 billion pounds, according to the Census Bureau's Fats and Oils stocks report. Soyoil consumed for methyl esters-biodiesel was pegged at 140.3 million pounds, up from 121 million in Jan, but down from 217 million in Feb 2008.