May 1, 2009
CBOT Soy Outlook on Friday: Steady, up; following overnight theme
Soybean futures on the Chicago Board of Trade are poised for a steady to firmer start, following the overnight theme in the absence of fresh overnight news to drive prices.
CBOT soybean futures are called to open steady to 2 cents higher. CBOT soy product futures are seen steady to mixed.
Most of the global markets were closed overnight for the May Day holiday, leaving futures with little fresh directives to influence prices, a CBOT floor analyst said.
Weather and speculative fund activity is seen as the driving forces, with the demand profile rather limited with much of the world on holiday, according to a market note from AgResource Company.
The market remains in a bullish state, however, with old crop contracts supported by tightening inventories and strong export demand. The spread of the swine flu epidemic has moved slower than expected, taking away a bearish influence on prices as well, traders said.
A technical analyst said market bulls have regained solid upside near-term technical momentum following an early week tumble.
The next upside price objective for July soybeans is to push and close prices above solid technical resistance at the January high of US$10.76 a bushel. The next downside price objective is pushing and closing prices below major psychological support at US$10 a bushel.
Bull spreads will be watched closely, after the July/November spread widened from 83 cents to US$1.11 1/2 in the past two days. Tight old crop inventories are supporting nearby contracts, while fears of increased soy acres due to planting delays for corn limit advances in deferred, new crop contracts.
The DTN Meteorlogix weather forecast said drier weather on tap from central Iowa northward may allow for improving field work conditions and more planting during the coming days. However, it could still be a while before fields dry out in the south and eastern Midwest regions.
In deliveries, May soybean deliveries totaled 130 lots. Customer accounts at Fortis issued and stopped 89 lots. The last trade date assigned was Feb. 17.
May soyoil deliveries totaled 2,465 lots. A customer account at ADM Investor Services issued 558 lots. A customer account at Man Professional Clearing stopped 1,188 lots. The last trade date assigned was April 30.
