April 21, 2009

 

CBOT Soy Review on Monday: Losses amid lower outside markets, profit-taking

 

 

Soybean complex futures at the Chicago Board of Trade closed lower and near the session low Monday. The key "outside markets" were in a strongly bearish posture for soybeans, as crude oil prices and stock indexes were sharply lower, and the U.S. dollar was solidly higher.

 

The soybean complex futures continue to be heavily influenced by these outside market forces, said market analyst Victor Lespinasse with www.grainanalyst.com.

 

July soybean futures closed down 29 1/4 cents at US$10.12 1/4. New-crop November soybeans closed down 33 cents at US$9.02.

 

"Traders are also taking profits out of the market after old-crop contracts either challenged or came near tough resistance at the January highs last week," said a Midwest-based market analyst. "The export demand talk that has been fueling recent price strength is being overshadowed to start the week as all of the demand news is considered to be factored into the market for now," he said.

 

Profit-taking pressure from recent strong gains was also seen Monday in soybeans, meal and soybean oil, said the analyst.

 

In overnight trading, China's soybean futures traded on the Dalian Commodity Exchange settled lower as profit-taking kicked in following gains in the last trading session, in line with overnight losses on the CBOT. The benchmark January 2010 soybean contract settled 1.5% lower at CNY3,492 a metric tonne. Analysts said Dalian soybean futures will likely consolidate in the near term on technical cues as fresh fundamental news is lacking.

 

In other news, reports Monday morning said the Rosario Grain Exchange reduced its Argentine soybean crop estimate to 37.3 million metric tonnes from 41.7 million.

 

Weather conditions across the corn belt are expected to be cool and wet in the eastern belt and dry in the western belt to start the week, after some weekend rains. A warmer and drier pattern will develop later in the week. Recent wet weather in parts of the corn belt will prompt delays in early season field work, said Meteorlogix weather.

 

Lespinasse said any corn planting delays in the corn belt are likely to be a bearish factor for soybeans, as intended corn acres could be switched to soybeans if wet weather persists into May.

 

The latest commitments of traders report issued by the Commodity Futures Trading Commission on Friday afternoon showed large speculators increasing their net long positions in soybeans by 10,577 contracts, to 109,037 contracts. Commercial soybean traders increased their net short positions by 18,121 contracts, to 207,224 contracts.

 

 

SOY PRODUCTS

 

Soybean oil and soybean meal futures also closed lower and near their daily lows Monday.

 

July soybean oil closed down 128 points at 35.79 cents a pound, while July soybean meal futures closed down US$6.90 a tonne at US$311.80.

 

Commercial traders of soybean oil and soybean meal futures increased their net short positions in the latest reporting week, according to the commitments of traders report. Soybean oil commercials added 9,870 contracts to their net short position of 138,573 contracts. Soybean oil large speculators saw short positions decrease by 4,209 contracts, to 24,670 contracts.

 

Soybean meal commercial traders increased their net short positions by 7,285 contracts, to 91,194 contracts, in the latest week, said the CFTC. Large speculators in soybean meal increased their net long positions by 4,977 contracts, to 34,098 contracts.