May 8, 2009

 

CBOT Soy Outlook on Friday: Up; recovery bounce from thurs setback

 

 

Chicago Board of Trade soybean futures are expected to start Friday's day session higher, staging a recovery bounce from Thursday's profit taking setback.

 

CBOT soybean futures are called to open 8 cents to 10 cents higher. CBOT soy product futures are seen higher in tune with overnight action.

 

A strong fundamental base, supportive outside market influences and technical strength are seen buoying prices, analysts said.

 

Speculation of China canceling previous purchases and shifting buys to the 2009-10 marketing year weighed on prices Thursday. However, without confirmation of the washed out sales, reports of China buying Brazilian and U.S. cargoes serve as supportive features to attract buyers, analysts said.

 

Tight old crop inventories remain a driver for old crop contracts, as traders look to push prices to levels that will ration consumption. Outlooks for the U.S. Department of Agriculture to trim 2008-09 ending stock forecasts by 35 million bushels in Tuesday's supply and demand report is a underpinning factor for prices.

 

A technical analyst said first resistance for July soybeans is seen at US$11.18 3/4 and then at Thursday's high of US$11.31. First support is seen at Thursday's low of US$10.95 and then at this week's low of US$10.85.

 

In deliveries, May soyoil deliveries totaled 1,717 lots. Customer accounts at Man Professional Clearing issued and stopped 1,151 lots and 701 lots respectively. The house account at ADM Investor Services stopped 459 lots. The last trade date assigned was May 7.

 

In overseas markets, soybean futures fell slightly on the Dalian Commodity Exchange Friday, losing momentum amid profit-taking and oversupply concerns as imports flood the market.

 

Soybean prices in China's major producing areas rose in the week ended Friday, propelled on news last week that the government was boosting its soybean stockpile.

 

Crude palm oil futures on Malaysia's derivatives exchange ended little changed in choppy range bound trade Friday as investors liquidated positions ahead of the weekend and release of key exports and supply statistics.