May 29, 2009

 

CBOT Soy Review on Thursday: Nearby contracts retreat; lack of export news

 

 

Chicago Board of Trade soybean futures ended mixed, with nearby contracts succumbing to pressure from a lack of fresh demand news to sustain buying interest at higher levels.

 

CBOT July soybeans settled 8 cents lower at US$11.79, and November soybeans finished 1 cent higher at US$10.51.

 

July soy meal settled US$2.40 lower at US$383.80 per short tonne. July soyoil finished unchanged at 37.81 cents per pound. In pit trades, speculative fund selling was estimated at 23,000 lots in soybeans and 1,000 lots in soymeal.

 

Activity in nearby contracts appeared a little tired, with the absence of fresh demand news to support prices attracting sellers once futures failed to challenge resistance near the US$12.00 level basis the July contract, said Jack Scoville, analyst with Price Futures Group in Chicago.

 

Talk of China canceling a prior purchase of U.S. soybeans, as well as market talk of demand shifting to South America, helped keep a lid on upside moves in old crop contracts.

 

The unwinding of old/new crop spreads added to the mixed tonnee, with buyers cautious at higher levels amid the potential for the rolling of large fund positions in the July contract, analysts said.

 

The July/November bull spread settled at US$1.25 a bushel, down from Wednesday's settlement of US$1.37 cents.

 

Uncertainty surrounding new crop acreage amid planting delays in the eastern Midwest supported the back end of the market, as traders are content to keep risk premium in prices.

 

Overall, the market settled into a consolidation theme, chopping around, awaiting fresh inputs to direct prices.

 

T-storm Weather LLC said showers in the central/eastern corn-belt will end overnight. Some showers may occur Friday night and Saturday across wettest areas of the corn-belt in Illinois and Indiana, but only a small strip of substantial totals is expected to occur, with most to receive only light amounts. The likelihood of rain will increase across the corn-belt from Sunday night and beyond, with the best chance for rain near Iowa and Nebraska on Monday and across Illinois from Monday night through Wednesday.

 

On tap for Friday, the U.S. Department of Agriculture weekly export sales report is scheduled to be released at 8:30 a.m. EDT, and analysts surveyed by Dow Jones Newswires estimate soybean sales for the week ended May 21 in a range of 650,000 to 950,000 metric tonnes. Soymeal export sales are seen between 150,000 and 350,000 tonnes, while soyoil sales are pegged between 5,000 and 25,000 tonnes.

 

 

SOY PRODUCTS

 

Soy product futures ended mixed, with soymeal retreating on spreads. Soymeal lost ground to oil on adjustments in spreads, succumbing to pressure from higher-than-expected stocks and a lack of fresh demand news. Soyoil futures ended steady, benefiting from weakness in soymeal on meal/oil spreads. Soyoil garnered support from lower-than-expected stocks in the Census crush report.

 

July oil share ended at 33%. The July soybean crush ended at 83 1/2 cents.