April 2, 2009

 

CBOT Soy Review on Wednesday: End steady, consolidates previous gains

 

 

Chicago Board of Trade soybean futures ended steady Wednesday, consolidating Tuesday's sharp gains after failing to generate momentum in either direction.

 

CBOT May soybeans ended unchanged at US$9.52, and November soybeans settled unchanged at US$8.92.

 

May soy meal settled US$1.00 lower at US$294.30 per short tonne. May soyoil finished 12 points lower at 33.50 cents per pound.

 

Concerns about tighter supplies and smaller acreage remain underpinning features, but spillover weakness from neighboring grains and mixed signals from outside markets applied offsetting pressure to temper upside potential, analysts said.

 

A quiet news front failed to provide any incentives for traders to push the market in either direction. The uncertainty surrounding 2009 acreage, with traders acknowledging that planting intention numbers will shift according to spring weather, promoted a cautious tonnee, a CBOT floor broker said.

 

New crop soybean futures did manage to gain ground against corn, as the market extended the soybean/corn spread ratio in an attempt to secure adequate acreage in 2009.

 

Otherwise, the trade continued to eye activity in Argentina, with reports of disappointing yields and lingering unrest between the government and its farmers supplying underlying support to keep a near term floor beneath prices, analysts said.

 

Argentina is the world's third-largest producer of soybeans and the global leader in soyoil and soymeal exports.

 

Looking ahead, traders anticipate choppy activity will continue into the overnight session, as traders remain cautious in the face of economic and fundamental uncertainties.

 

The DTN Ag Weather forecast Wednesday for the central U.S. called for a pattern featuring unsettled, active and overall chilly conditions during the next 10 days. This pervasive unfavorable early-season trend means spring fieldwork delays can be expected.

 

On tap for Thursday, U.S. Department of Agriculture's weekly export sales report will be released at 8:30 a.m. EDT. Analysts surveyed by Dow Jones Newswires estimate soybean sales for the week ended March 19 in a range of 350,000 to 625,000 metric tonnes. Soymeal export sales are seen between 75,000 and 150,000 tonnes, while soyoil sales are pegged between 40,000 and 65,000 tonnes.

 

 

SOY PRODUCTS

 

Soy product futures ended lower, with soymeal stumbling on a lack of leadership from soybeans, while soyoil drifted lower on weakness from crude oil futures, traders said.

 

In pit trades, speculative fund selling was estimated at 1,000 lots in each soymeal and soyoil.

 

May oil share ended at 36.27%. The May soybean crush ended at 64 cents.