April 24, 2009

 

CBOT Soy Review on Thursday: Lower; consolidate after early buys fade

 

 

Soybean futures at the Chicago Board of Trade ended lower Thursday, backpedalling as the market consolidated after climbing to new highs for the week in early action.

 

CBOT May soybeans ended 8 1/4 cents lower at US$10.37 3/4, July soybeans settled 7 cents lower at US$10.32 and November soybeans finished 1/2 cent lower at US$9.23 1/2.

 

July soy meal settled US$4.80 lower at US$317.80 per short tonne. July soyoil finished 12 points higher at 36.50 cents per pound.

 

Supportive fundamentals served as the catalyst to advance prices initially, but exhausted buying at session highs, and a weakening cash basis provided pressure to entice traders into booking some profits, said Joe Victor, an analyst with Allendale Inc.

 

The consolidative theme was fostered by end-of-month book balancing and positioning ahead of Friday's expiration of options on May soybean futures, analysts said.

 

The unwinding of old/new crop spreads saw the July/November soybean spread narrow from US$1.15 to US$1.08 1/2 Thursday.

 

New crop futures managed to garner some strength from the uncertainty of 2009 plantings, with the market awaiting future weather development that will shape eventual planted acres.

 

Nevertheless, old crop futures remain in a bullish state, with strength rehashed by supportive export demand, Argentina crop woes and a lack of fresh bearish news. The market is poised to remain firmly underpinned, but profit-taking is expected to continue to surface on any sign of buyer exhaustion.

 

In pit trades, speculative fund selling was estimated at 2,000 lots.

 

U.S. Department of Agriculture reported total weekly soybean export sales were a net 1,441,400 metric tonnes for the week ended April 16. Sales for 2008-09 were a net 617,100 metric tonnes. USDA on Thursday also announced private export sales of 100,000 metric tonnes of soybeans for delivery to Mexico in the 2009-10 marketing year.

 

 

SOY PRODUCTS

 

Soy product futures ended mixed, with soymeal stumbling in unison with soybeans. Consolidative action was featured in soymeal, as traders booked profits following recent gains. Soyoil futures shook off weakness from the rest of the complex. The market found support from a push to eight-month highs in Malaysian palm oil, larger-than-expected weekly export sales, and lower-than-expected soyoil stocks reported in the March Census crush report.

 

USDA said soyoil commitments were 57,800 metric tonnes. Meanwhile, Census Bureau said March soyoil stocks totaled 3.064 billion pounds. Analysts, on average, expected 3.113 billion pounds.

 

In pit trades, speculative fund selling was estimated at 1,000 lots in soymeal.

 

July oil share ended at 36.48%. The July soybean crush ended at 68 3/4 cents.