May 21, 2008

 

CBOT Soy Review on Tuesday: Mixed; drifts on late positioning, soymeal slide

 

 

Chicago Board of Trade soybean futures ended mixed Tuesday, finishing well off earlier highs on late session position evening and spillover pressure from retreating soymeal futures.

 

July soybeans settled 1 1/2 cents lower at US$13.31 1/2 and November soybeans ended 3 3/4 cents higher at US$13.25 3/4. July soymeal settled US$5.30 lower at US$333.50 per short tonne. July soyoil finished 83 points higher at 61.03 cents per pound.

 

The market stumbled in late dealings, failing to sustain earlier gains, as light pressure from confirmation of the suspension of the Argentine farmers' strike and outlooks for a rapid increase in soybean plantings during the next week took some edge off prices, analysts said.

 

Futures had little fundamental reason to justify the early spike in prices aside from speculative short covering from Monday's slide and the bullish influence of a weaker dollar and record high crude oil futures, analysts added.

 

Late session weakness in soymeal futures helped pressure soybeans, as the markets adjusted to keep spread relationships in line, a cash-connected CBOT broker said.

 

Soybeans have settled into a sideways trading pattern, with the ability of nearby contracts to hold above major moving average support underpinning prices while a lack of fresh fundamental news to push prices near overhead resistance continues to promote volatile, wide daily trading ranges, a CBOT floor broker said.

 

Nevertheless, bullish longer-range fundamental outlooks associated with tight ending stock forecasts and the uncertainties of final acreage and future demand remain underlying themes to limit downside momentum, he added.

 

In pit trades, buyers and sellers were scattered among various commission houses, with speculative fund selling estimated at 1,000 lots.

 

 

SOY PRODUCTS

 

Soy product futures ended mixed, with soyoil bouncing on a technical recovery from Monday's declines and borrowed momentum from a record high climb in crude oil futures.

 

However, soyoil finished well off earlier highs on late profit-taking and adjustments in the oil/meal spread relationship, analysts said.

 

Soymeal futures stumbled, backpedaling from initial advances on oil/meal spreading and a lack of fresh supportive news to sustain buying interest after nearby contracts failed to challenge major moving average resistance above the market on technical charts, analysts added.

 

July oil share ended at 47.78% and the July crush ended at 73 1/2 cents.

 

In soymeal trades, buyers and sellers were scattered among various commission houses, with speculative fund selling estimated at 1,000 lots.

 

In soyoil trades, buyers and sellers were scattered among various commission houses, with speculative fund buying estimated at 3,000 lots.