May 7, 2007

 

CBOT Soy Outlook on Monday: 1-3 cents higher on corn spillover, e-CBOT

 

 

Chicago Board of Trade soybean futures are predicted to begin trading 1-to-3 cents higher Monday, as a higher start expected in corn futures and spillover from firm trading overnight is expected to underpin prices, traders said.

 

In overnight e-CBOT trading, May soybeans rose 1 cent to US$7.34 1/2 per bushel, July gained 2 3/4 cents to US$7.50 1/4 and November rose 3 1/4 cents to US$7.79 1/2. e-CBOT volume in July was 2,679 contracts.

 

Soybeans should trade higher on corn spillover but gains should be tempered by ideas that Monday's planting progress report should show a decent increase in the eastern U.S. Midwest and Minnesota, said Don Roose, president of US Commodities in West Des Moines Iowa.

 

Ideas that producers will be able to plant their corn crop despite the heavy rains over the weekend in the western U.S. Midwest should limit the amount of corn acres switched to soybeans and also add support, he added.

 

In the western U.S. Midwest there is a chance for light or locally moderate showers with amounts of .25-.75 inch in eastern locations Monday and lingering Tuesday, DTN Meteorologix Weather said. Temperatures are expected to average above normal.

 

In the eastern U.S. Midwest, any shower activity will be confined to northwestern sections Friday with light showers possible in western section son Tuesday. Temperatures are predicted to average above normal in this period.

 

In the 6-to-10 day outlook, temperatures are expected to average near-to-above normal with rainfall near-to-above normal west and near-to-below normal east.

 

On day session open auction technical charts, July soybeans closed nearer the session low and a two-month old downtrend line is still in place on the daily bar chart, a technical analyst said. A close above US$7.58 1/2 would help bulls regain fresh technical momentum, the analyst said.

 

First resistance for July is seen at US$7.50 and then at US$7.53 3/4, Friday's high. First support is pegged at US$7.44 and then at US$7.38 1/2.

 

Large commercial traders cut their long CBOT soybean futures and options on futures positions by 12,889 contracts while adding 3,831 contracts to their short positions and are now net short 154,073 contracts as of May 1, the Commodity Futures Trading Commission reported Friday.

 

Large speculative traders increased their long futures and options on futures positions by 9,768 contracts and reduced their short positions by 6,936 contracts and are now net long 49,529 contracts, the CFTC said.

 

In overseas markets, crude palm oil futures on the Bursa Malaysia Derivatives ended sharply lower. The July contract fell MYR43 at MYR2,245 per metric tonne.

 

Soybean futures on China's Dalian Commodity Exchange remain closed for the Labor Day holiday.

 

Monday morning at 11:00 a.m. EDT, the U.S. Department of Agriculture is scheduled to release the weekly export inspections report. At 4:00 p.m. EDT (2000 GMT) the USDA is scheduled to release the weekly crop progress.