May 3, 2007

 

CBOT Soy Review on Wednesday: Lower; consolidates, lack of fresh support

 

 

Chicago Board of Trade soybean futures ended lower Wednesday, succumbing to consolidative sales in the absence of fresh supportive news and a lack of speculative buying interest, analysts said.

 

July soybeans settled 7 3/4 cents lower at US$7.48 1/2, and November soybeans finished 6 1/2 cents lower at US$7.77. July soymeal settled US$2.60 lower at US$201.10 per short tonne. July soyoil ended 22 points lower at 33.59 cents a pound.

 

The market staged a minor correction from recent gains, stumbling to session lows on the close as technical selling surfaced after active contracts failed to hold underlying technical support down the stretch, analysts said.

 

Overall activity was relatively quiet, with many traders taking a cautious approach to the market amid a lack of fresh directives with the heart of Midwest plantings still ahead of the market as well as the uncertainty of potential corn acreage shifts to soybeans, analysts added.

 

Otherwise, the market lacked fundamental features, with traders keyed on the July contract's 100-day moving average for a possible sign of future direction. The market gravitated toward the 100-day moving average over the course of the day, as traders looked for signs of follow through price strength after the July contract settled above the key average for the first time in a couple of weeks Tuesday, analysts said.

 

On tap for Thursday, the Census Bureau will release its revised soyoil stocks and consumption data 8:00 a.m. EDT (1200 GMT). U.S. Department of Agriculture is scheduled to release weekly export sales figures for the week ended April 26 at 8:30 a.m. EDT. Analysts surveyed by Dow Jones Newswires estimated soybean sales would range from 150,000 to 400,000 metric tonnes. Soymeal commitments were estimated in a range of 75,000 to 125,000 tonnes and soyoil sales were estimated in a range of zero to 30,000 tonnes.

 

In pit trades, buyers and sellers were lightly scattered among various commission houses, with speculative funds estimated sellers of between 2,000 and 3,000 contracts.

 

 

SOY PRODUCTS

 

Soy product futures ended lower across the board, consolidating from recent gains. An overall quiet tonnee was a common theme in the products, with soyoil continuing to consolidate from Monday's spike to new contract highs, analysts said. The absence of fresh news and spillover weakness from crude oil futures served as catalysts to keep prices on the defensive, traders added.

 

Meanwhile, soymeal futures stumbled back from Tuesday's run up to two-week highs, analysts said. The lack of continued soyoil/soymeal spread unwinding kept activity featureless, with traders willing to take some profits off the table, analysts added.

 

July oil share ended at 45.51% and the July crush ended at 63 1/2 cents.

 

In soyoil trades, JP Morgan and Fimat each bought 300 July contracts. JP Morgan sold 600 July, Tenco sold 300 July and Iowa Grain sold 200 July. Speculative fund selling was estimated at 2,500 contracts.

 

In soymeal trades, Fimat bought 300 July, with ADM Investor Services, JP Morgan and Rand Financial each bought 200 July. JP Morgan sold 300 July.