June 8, 2006

 

Thursday: China soybean futures settle tad higher on CBOT; corn up

 

 

Soybean futures traded on China's Dalian Commodity Exchange settled mostly higher Thursday on an overnight rebound in Chicago Board of Trade soybean futures, though long liquidation pared the earlier gains, analysts said.

 

The benchmark September 2006 soybean contract rose RMB2 to settle at RMB2,651 a metric tonne, after trading between RMB2,636/tonne and RMB2,662/tonne.

 

Trading volume for all soybean contracts fell to 15,080 lots from 20,772 lots Wednesday.

 

One lot equals 10 tonnes.

 

No. 2 soybean contracts, which are encouraged to be delivered with soybeans harvested from genetically modified crops, settled mostly up.

 

The benchmark September contract settled RMB5 higher at RMB2,544/tonne.

 

"Some long position holders suddenly realized that they have gone too far from fundamentals, given the slow recovery of feed demand and the huge arrivals in the recent months," said Xu Lixin, an analyst with Jingyi Futures Co.

 

"The report of a new outbreak of bird flu became a catalyst for the liquidation," said Xu.

 

The Ministry of Agriculture reported late Wednesday an outbreak of the H5N1 bird flu has been confirmed in poultry in the western Xinjiang Uygur Autonneomous Region.

 

Soymeal futures settled mostly higher, along with soybean futures.

 

The benchmark November 2006 contract settled unchanged at RMB2,361/tonne, after trading between RMB2,348/tonne and RMB2,378/tonne.

 

Total trading volume fell to 356,488 lots from 405,996 lots Wednesday.

 

Dalian's soyoil futures settled lower. The most widely held September 2006 soyoil contract fell RMB5 to settle at RMB5,184/tonne.

 

Analysts said as consumption of soyoil dips in summer, it's likely to be even weaker than other soy futures.

 

Corn futures also settled mostly higher, though long liquidation also trimmed some gains.

 

The benchmark March 2007 contract rose RMB4 to settle at RMB1,510/tonne, after trading between RMB1,503/tonne and RMB1,522/tonne.

 

Total trading volume for all corn contracts fell to 381,750 lots from 430,260 lots Wednesday.