May 31, 2008

 

CBOT Soy Review on Friday: Up; technical correction from thu losses

 

 

Chicago Board of Trade soybean futures ended sharply higher Friday, retracing most of Thursday's declines on a technical correction, Argentina concerns and planting delays.

 

July soybeans settled 40 3/4 cents higher at US$13.63 1/2 and November soybeans ended 33 cents higher at US$13.54 1/2. July soymeal settled US$9.70 higher at US$341.50 per short tonne. July soyoil finished 101 points higher at 61.31 cents per pound.

 

Technical support from futures bouncing off a drop near the bottom of a multiweek trading range in conjunction with the lack of a resolution to the Argentina farmers strike served as the catalyst to propel futures, said John Kleist, broker/analyst with Allendale Inc. in McHenry, Ill.

 

The absence of bearish outside market influences that weighed on prices Thursday coupled with concerns over plantings delays provided additional support to underpin prices, Kleist added.

 

Rumors of China buying additional supplies from the U.S. and Brazil as well as end-of-week and -month position evening supplied price strength as well, traders said.

 

Meanwhile, old/new crop spreading was featured as a strong crush and nearby export demand served as the catalyst that allowed the front end of the market to gain at the expense of deferred-month futures, analysts added.

 

Nevertheless, traders said the July contract remains entrenched in a sideways trading pattern between the April high of US$14.15 and the May low of US$12.44. The direction in which prices break out of this trading range is likely to be the next significant trend in prices, traders added.

 

In pit trades, buyers and sellers were scattered among various commission houses, with speculative fund buying estimated at 2,000 lots.

 

 

SOY PRODUCTS

 

Soy product futures ended higher, recovering from Thursday's price setback. The markets were buoyed by a combination of bullish technical and fundamental events, analysts said. Soyoil garnered strength from a recovery in crude oil prices, with both meal and oil underpinned by technical buying and supportive demand outlooks tied to a lingering farmers' strike in Argentina, analysts added.

 

July oil share ended at 47.3% and the July crush ended at 62 1/4 cents.

 

In soymeal trades, buyers and sellers were scattered among various commission houses, with speculative fund buying estimated at 2,000 lots.

 

In soyoil trades, buyers and sellers were scattered among various commission houses, with speculative fund buying estimated at 2,000 lots.