April 20, 2006

 

Thursday: China soybean futures settle slightly lower; corn down

 

 

Soybean futures on China's Dalian Commodity Exchange settled slightly lower in quiet trading Thursday on modest losses overnight in Chicago Board of Trade soybean futures, said analysts.

 

The benchmark September 2006 soybean contract settled RMB3 lower at RMB2,603 a metric tonne.

 

Trading volume for all soybean contracts shrank further to 25,110 lots from 31,012 lots Wednesday. One lot equals to 10 tonnes.

 

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

 

The benchmark September contract fell RMB10 to settle at RMB2,520/tonne.

 

"There is not much market-moving fresh news, and such boring, narrow range-bound trading is likely to continue even after the week-long Labor Day holiday," said Tang Yi, soy analyst with Capital Futures Co.

 

Even though other commodities markets are booming, it still can't lend much support to the soy futures, which are heavily pressured by the oversupply situation, Tang said.

 

"What you can expect is perhaps a RMB10 gain today and a RMB8 loss tomorrow," he said.

 

Soymeal futures settled lower, along with soybean futures. The benchmark September 2006 contract fell RMB3 to settle at RMB2,213/tonne, after trading between RMB2,209 and RMB2,219/tonne.

 

China hasn't reported any new outbreaks of bird flu among poultry since the end of February, though a human infection was confirmed late Tuesday. Meanwhile, feed consumption is rising slowly.

 

"But the growth of consumption lags far behind the rising supply," said Tang.

 

Crushing soybeans produces soymeal for making animal feed and soyoil for making cooking oil.

 

Dalian's soyoil futures settled mostly higher. The benchmark September 2006 contract rose RMB18 to settle at RMB5,087/tonne.

 

Corn futures settled lower. The benchmark January 2007 contract settled RMB7 lower to RMB1,402/tonne, after trading between RMB1,399 and RMB1,407/tonne.

 

Trading volume for all corn contracts fell slightly to 358,348 lots from 387,364 lots Wednesday.