April 11, 2008
Friday: China soybean futures settle down on supply pressure
China's soybean futures traded on the Dalian Commodity Exchange settled lower Friday amid expectations of supply pressure.
The benchmark January 2009 soybean contract settled RMB35, or 0.86%, lower at RMB4,012 a metric tonne.
New-crop contracts led the decline, the result of expected increased soybean acreage this year.
Soybean acreage in Heilongjiang province - a major producing region - is likely to increase by 19% in 2008 from a year earlier, said Zhao Qiang, a manager at Tianqi Futures.
However, old-crop contracts are strongly supported by limited stocks, and may thus lend some support to new-crop contracts.
But the support could be very limited, said Zhao, who expects production costs for new soybeans will be RMB3,400-RMB3,500/tonne.
Ample supply from North and South America also plagued the market.
China imported 2.32 million metric tonnes of soybeans in March, up 9.9% from a year earlier, according to preliminary data issued by the General Administration of Customs Friday.
The country also imported a total of 2.01 million tonnes of vegetable oil in the first quarter, up 9.1% from 1.84 million tonnes last year.
Palm oil futures settled mostly lower, while soyoil futures settled mostly higher in tandem with their counterparts at the Chicago Board of Trade overnight.
Sluggish soymeal prices helped to push soyoil prices higher as processing plants need to make profits.
Soymeal futures settled mostly lower but corn futures settled mostly higher.
Friday's settlement prices in yuan a metric tonne and volume for all contracts in lots (One lot is equivalent to 10 tonnes):
Contract Settlement Price Change Volume
Soybean Jan 2009 4,012 Dn 35 1,027,788
Corn Jan 2009 1,909 Up 13 1,035,152
Soymeal Sep 2008 3,251 Dn 1 447,714
Palm Oil May 2008 10,486 Dn 54 5,196
Soyoil Sep 2008 11,072 Up 20 352,648
