Monday: China soy futures lead complex higher; catch up with CBOT

China soy futures rose on the Dalian Commodity Exchange Monday, leading the agricultural complex higher as prices sought to catch up with external markets after China's holiday break Thursday and Friday last week.

 

The benchmark January 2010 soy contract rose 2% to settle at RMB3,745 a metric tonne.

 

"External markets played a big role in today's commodities performance," said Gao Yanrong, research manager with Dalu Futures in Shanghai.

 

China's purchasing managers index reached 53.1 in May, marking the third consecutive month that the reading surpassed 50.

 

A reading above 50 reflects growth in manufacturing sector; a sustained trend suggests China is on its way to economic recovery.

 

Shrinking soy stocks also played a role in supporting prices, analysts said.

 

soy stocks on Dalian warehouses fell 228 tonnes last week.

 

"The dollar is also weaker, and with oil at US$67 a barrel, that bodes well for agricultural commodities too," Gao said.

 

soy futures on the Chicago Board of Trade ended higher Friday, with new crop contracts leading the upside.

 

Lingering planting concerns in the Midwest added some risk premium to the market, lending support to prices, analysts said.

 

Soymeal, corn, palm oil and soyoil futures rose in tandem with soy Monday.  

 

Monday's settlement prices in yuan a metric tonne for benchmark contracts and volume for all contracts in lots (One lot is equivalent to 10 tonnes):  

 

Contract    Settlement        Price       Change     Volume

soy            Jan 2010         3,745        Up   74     477,058

Corn          Jan 2010         1,663        Up   13     83,998

Soymeal    Jan 2010         2,921        Up   53     798,206

Palm Oil     Sep 2009        6,862        Up  284    275,828