April 23, 2007

 

CBOT Soy Outlook on Monday: Flat; lacks fresh fundamental influence

 

 

Chicago Board of Trade soybean futures are expected to start Monday's day session with a steady undertone, following the lead of overnight action amid the absence of fresh fundamental influences, analysts said

 

In e-CBOT trade, May was unchanged at US$7.23 1/4, July was 1/4-cent higher at US$7.40 1/2, and November soybeans were 1/4-cent lower at US$7.67 1/4.

 

CBOT soybean futures are called to start the session flat.

 

A quiet news front is promoting a steady atmosphere, with the market in a waiting mode until the planting season gets into full swing, with uncertainty over the progress of corn plantings and what effect that will have on soy seedings keeping many participants sidelined, an analyst said.

 

Spillover weakness from neighboring grain futures, with ample nearby global supply fundamentals are seen applying light pressure to prices, traders said. However, with good weekend planting activity for corn and a warmer and drier longer range forecast for the Midwest, soybeans may find strength from ideas of less forced switching of corn acres to soybeans, traders added.

 

The DTN Meteorlogix Weather Service forecast said the western Midwest experienced rain during the weekend with more rain expected early this week, likely meaning delays and disruptions to field work and planting activities during the week. Meanwhile, heavy rains are expected to return to the eastern Midwest late Tuesday and Wednesday. This will halt any field work or planting that has been going on under the dry and warm weather of recent days.

 

However, the Meteorlogix 6-10 day forecast for the entire Midwest calls for temperatures to average near to above normal, with near to below normal precipitation.

 

The Commodity Futures Trading Commission on Friday reported in its supplemental commitment of traders report that index funds were reported to hold net long positions totaling 135,860 combined soybean futures and options contracts as of April 17, down from 136,017 the prior week. Traditional large speculative traders were net long 47,990 contracts compared with net longs of 58,372 in the previous week. Commercials were reported to hold net short combined futures and options positions totaling 155,099 contracts, down from the previous week's 170,518 contracts.

 

On tap for Monday, the U.S. Department of Agriculture is scheduled to release its weekly export inspections report at 11 a.m. EDT (1500 GMT).

 

China's March soybean imports fell 19% on year to 2.11 million metric tonnes, the General Administration of Customs said Monday. In January-to-March, soybean imports rose 6% to 5.72 million tonnes.

 

In overseas markets, soybean futures traded on the Dalian Commodity Exchange settled higher Monday on favorable fundamentals, but uncertain weather conditions during the planting season remain a factor. The benchmark September 2007 contract settled RMB14 higher at RMB3,081 a metric tonne.

 

Crude palm oil futures on the Bursa Malaysia Derivatives ended slightly lower Monday as the market succumbed to some profit-taking pressure amid choppy trading. The benchmark July contract ended down MYR10 at MYR2,169 a metric tonne after moving between MYR2,162 and MYR2,205/tonne.