April 24, 2009

 

CBOT Soy Outlook on Friday: Down 1-3 cents; consolidating into weekend

 

 

Chicago Board of Trade soybean futures are expected to start Friday's day session with modest declines as the market consolidates heading into the weekend.

 

CBOT soybean futures are called to open 1 cent to 3 cents lower.

 

Light profit taking is expected to apply pressure, but early support from outside markets and bullish underlying fundamentals is seen limiting downside risks, analysts said.

 

Choppy activity is expected to linger through the session with traders evening up some positions ahead the expiration of options on May futures on Friday's close.

 

The absence of fresh inputs has taken some steam out of the market, with buyers in a cautious mode. Market bulls have run into some "headwinds" at higher price levels, opening the door for selling on the exhaustion buying near recent highs, said Vic Lespinasse, analyst at Grainsanalyst.com.

 

A technical analyst said the next upside price objective for July soybeans is to push and close prices above solid technical resistance at last week's high of US$10.64 1/2 a bushel. The next downside price objective is pushing and closing prices below psychological support at US$10.00 a bushel.

 

CBOT soy product futures are seen mixed, as soymeal and soyoil consolidate in unison with soybeans.

 

On the demand front, the U.S. Department of Agriculture on Friday announced private export sales of 120,000 metric tonnes of soybeans for delivery to unknown destinations in the 2009-10 marketing year.

 

In other news, Statistics Canada said Canadian farmers intend to plant 14.99 million acres of canola in 2009, below the range of estimates from a Dow Jones Newswires survey that span from 15.75 million to 17 million acres.

 

In overseas markets, soybean futures traded on China's Dalian Commodity Exchange settled lower Friday, following an alert issued by the government on excessive imports.

 

China's Ministry of Commerce said Friday that Chinese companies should slow soybean and rapeseed imports to avoid risks associated with large inventories. It said imported edible oil and oilseeds stocks at Chinese ports are too high due to heavy imports between January and April.

 

Crude palm oil futures on Malaysia's derivatives exchange rose Friday on speculation of higher on-month exports in the April 1-25 period, said trade participants.