April 7, 2006

 

CBOT Soy Review on Thursday: Higher on technicals, funds, outside markets

 

 

Chicago Board of Trade soybean futures ended higher Thursday, supported by good-sized gains in neighboring corn and wheat futures and a rally in outside commodity markets, floor sources said.

 

CBOT May soybeans settled 2 1/2 cents higher at 5.64 per bushel; CBOT May soymeal finished 40 cents higher at US$172.70 per short tonne, and CBOT May soyoil ended up 30 points at 22.67 cents per pound.

 

Corn and wheat plus the rally in outside markets helped support soybeans, a commission house analyst said.

 

Without the higher prices in the other pits and the gains in gold and crude oil, CBOT soybeans probably would have been lower, he added.

 

Light short-covering and some thin technical buying also helped prices, a floor analyst said, noting that soybeans were pretty hard hit after last week's U.S. Department of Agriculture prospective plantings report.

 

With the USDA's supply and demand report coming out Monday, some people covered their positions, he added.

 

The USDA is scheduled to release the April supply and demand report at 7:30 CDT on Monday.

 

The average of 15 analysts surveyed by Dow Jones expect soybean ending stocks to increase to 574 million bushels, up 9 million from the USDA's estimate in March.

 

Weekly U.S. soybean export sales of 368,800 metric tonnes, consisting of both old- and new-crop combined, also added a thin layer of support, traders said. Sales were above analyst expectations of 200,000-350,000 tonnes.

 

News that Chinese soy firms had signed contracts during a visit to Chicago to import 4.98 million metric tonnes of U.S. soybeans also provided some support, they noted.

 

Forecasts for good U.S. Midwest rains during the next several days kept some buying interest on the sidelines, a floor trader noted.

 

In pit trades, ABN Amro bought 500 May soybeans and 200 July; JP Morgan bought 500 July; Fimat bought 500 May and 200 July; and ADM bought 200 May and 200 July.

 

On the sell side, Calyon Financial sold 2,000 May; JP Morgan sold 1,000 May; ADM sold 300 May; Citigroup sold 500 May; and FC Stonnee sold 300 May.

 

Commodity funds were even on the day, brokers said.

 

CBOT South American soybean futures finished higher with the May contract up 2 1/2 cents at 5.89 and the July ended 2 cents higher at US$6.03.

 

Brokers continued to eye South American soy harvest reports.

 

 

SOY PRODUCTS

 

CBOT soy meal futures finished mostly higher Thursday in quiet trade as the steady tonnee in soybeans provided an undertonnee of support, floor analysts said.

 

Weekly export sales of U.S. soybean meal totaled 68,200 metric tonnes including 31,100 tonnes for 2006-07 crop year, at the low end of estimates, brokers said.

 

In soy meal trades, Man Financial bought 600 July, JP Morgan sold 1,000 May RJ O'Brien sold 300 May, brokers said, adding that commodity funds were net buyers of an estimated 900 contracts.

 

CBOT soy oil futures also benefited from Thursday's modest gains in soybeans as well as a light flurry of light buying interest and ending near the highs of the session, brokers said.

 

Weekly U.S. soyoil export sales had little impact, with the USDA reporting weekly exports at a negative 900 tonnes.

 

In Thursday's CBOT soy oil trades, Bunge bought 400 May and 300 July; and Iowa Grain sold 800 May and 300 July, brokers said.

 

The CBOT May oil share ended at 39.63% and the May crush ended 65 1/4 cents.