April 5, 2006

 

Wednesday: China soybean futures settle lower on CBOT; corn up

 

 

Soybean futures on China's Dalian Commodity Exchange settled lower Wednesday, with most contracts stumbling again to the lowest points since early December, on fundamental and technical weakness, traders said.

 

The benchmark September 2006 soybean contract settled RMB13 lower at RMB2,622 a metric tonne, after touching lowest point since early December at RMB2,611/tonne.

 

Trading volume for all soybean contracts fell slightly to 76,308 lots 91,572 lots Tuesday.

 

Total open interest fell 8,400 to 277,584 lots.

 

One lot equals 10 tonnes.

 

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

 

The benchmark September contract fell RMB25 to settle at RMB2,520/tonne, after trading between RMB2,505/tonne and RMB2,530/tonne.

 

Continuing retracement of soybean futures on the Chicago Board of Trade Tuesday weighed heavily on the local market, said Shi Junfeng, an analyst with Tianma Futures Co.

 

"Both markets seem to need some time digest the USDA's report," Shi said, adding that technical analysis also indicates a further downward is likely.

 

Meanwhile, local soybean physical prices are still pressured by the rising supply, as farmers are keen to sell before the spring plowing, while feed consumption hasn't picked up substantially, analysts said.

 

Crushing soybean gets soymeal which is used to produce animal feeds, and soyoil which is used to produce edible oils.

 

Soymeal futures settled mostly lower, along with soybean futures.

 

The benchmark September 2006 contract settled RMB16 lower at RMB2,227/tonne, after trading between RMB2,220/tonne, the lowest point since early December, and RMB2,238/tonne.

 

Soyoil futures settled mostly lower. The benchmark September 2006 contract fell RMB16 to RMB5,088/tonne.

 

Most corn futures settled slightly higher on tentative buying, after being heavily pressured by local soybean futures in previous sessions, analysts said.

 

The most widely held September 2006 contract settled unchanged at RMB1,397/tonne, after trading between RMB1,391/tonne and RMB1,403/tonne.

 

Trading volume for all contracts were up at 461,902 lots from 321,208 lots on Tuesday.