April 6, 2007

 

CBOT Soy Review on Thursday: Grinds lower in choppy pre-holiday trade

 

 

Chicago Board of Trade soybean futures ended Thursday's day session fractionally lower after a chopping on either side of unchanged levels in pre-holiday weekend trade.

 

May soybeans ended 1/2 cent lower at US$7.60 1/2, and November soybeans finished 1/2 cent lower at US$8.04 3/4. May soymeal settled US$0.20 lower at US$213.00 per short tonne. May soyoil ended 15 points lower at 32.42 cents a pound.

 

The market settled into holiday mode Thursday, with traders unwilling to take on added risk ahead of the extended three-day weekend, said Joe Victor, analyst with Allendale Inc. in McHenry, Ill.

 

CBOT agricultural markets will be closed Friday in observance of the Good Friday holiday. The markets will resume trading Sunday evening on the electronic platform.

 

The market just came off big deal of corn/soybean spread unwinding and many traders were content to sit on the sidelines heading into the weekend, Victor added.

 

Two-sided trade was a featured attraction, with lingering concerns over soybeans potentially picking up additional acreage on corn planting delays and the shifting of demand to South American origins applying pressure. Meanwhile, longer range supportive fundamentals amid rising global demand and the need to avoid any yield losses in 2007 kept a floor under prices, analysts said.

 

The nearby May futures gravitated near its 50-day moving average over the course of the day, while the new-crop November futures remained firmly planted above key moving average support.

 

The DTN Meteorlogix forecast calls for much below-normal temperatures to cover the entire Midwest, Plains, and the northern half of the Mississippi Delta during the next five days. Temperatures will range from the teens to low 20s Fahrenheit across the Midwest.

 

The weather pattern for next week in the Midwest is shaping up as a pattern featuring normal to below-normal temperatures, along with above-normal precipitation. This wet and cool weather trend is unfavorable for significant fieldwork progress, Meteorlogix forecasts.

 

Meanwhile, export basis for spot soybean supplies dropped by 1-3 cents per bushel for a second straight day at the Louisiana Gulf market Thursday, traders said. The drop was attributed to competing supplies of newly harvested soy from South American actively moving onto the world market.

 

The U.S. Department of Agriculture reported weekly soybean export sales were 295,300 metric tonnes for the week ended March 29. Included in the total were sales of 36,300 metric tonnes for the 2007-08 marketing year. The 2006-07 sales were a marketing-year low, 4% lower than the previous week, and 43% below the prior four-week average. Analysts had forecast sales between 300,000 and 350,000 metric tonnes.

 

In pit trades, buyers and sellers were lightly scattered among various commission houses.

 

 

SOY PRODUCTS

 

Soy product futures ended mixed, with the products consolidating ahead of the extended holiday weekend. Soyoil futures ended lower across the board, pressured by end of the week position squaring, as the market continued its theme of consolidation following Monday's climb to contract highs, analysts say. However, higher-than-expected weekly export sales and a downward revision in Census soyoil stock provide underlying support, traders added.

 

Soymeal futures ended narrowly mixed, finding stability on light soyoil/soymeal spread unwinding and commercial buying, traders said. The market chopped along in unison with soybeans, as traders cleared up positions ahead of the long weekend, a CBOT floor analyst said.

 

May oil share ended at 43.22% and the May crush ended at 64 3/4 cents.

 

In soyoil trades, buyers and sellers were scattered among firms with JP Morgan buying 300 May and 300 August.

 

In soymeal trades, Bunge Chicago and FCStonnee each bought 300 July, Tenco bought 400 May, and Fimat bought 400 July. UBS Securities sold 500 May and JP Morgan sold 400 July.