June 17, 2009

 

CBOT Soy Outlook on Wednesday: Down 2-4 cents, outside markets; fresh news void

 

 

Soybean futures at the Chicago Board of Trade are poised for a slightly lower start to Wednesday's day session, with pressure from outside markets and the absence of fresh supportive fundamental news weighing on prices.

 

CBOT soybean futures are seen opening 2 cents to 4 cents lower.

 

The market is settling into a consolidation mode, struggling to find direction in the absence of fresh news following its recent three-month uptrend, said Don Roose, president U.S. Commodities in West Des Moines, Iowa.

 

A choppy theme is on tap for traders, with slightly negative signals from key outside financial markets and overnight weakness in Asian markets, Roose said.

 

Meanwhile, concerns about future demand from China after two weeks of cancellations appearing in the weekly export sales report are seen taking some edge off prices, as base liquidation in the July contract ahead of the delivery period is a bearish feature as well.

 

Bullish traders will be respectful of potential cancellations from China, particularly with large purchases still on the books, Roose said.

 

Otherwise, traders will keep an eye on weather conditions, with traders taking a cautious approach ahead of the June 30 stock and acreage reports, unless outside markets or fresh fundamental news emerges to spark activity, analysts said.

 

A technical analyst said first resistance for November soybeans is seen at Tuesday's high of US$10.45 and then at US$10.50. First support is seen at Tuesday's low of US$10.20 1/2 and then at US$10.00.

 

DTN Meteorlogix said episodes of scattered thunderstorms and warmer temperatures favor developing crops while delaying final planting efforts. Longer range charts suggest a chance for drier, warmer weather, over the southern Midwest regions, allowing for better conditions for field work.

 

In overseas markets, soybean futures on the Dalian Commodity Exchange mostly rose Wednesday on a weaker dollar and more expensive imports. The benchmark January 2010 soybean contract was unchanged at TONNE3,645 a metric tonne.

 

Crude palm oil futures on Malaysia's derivatives exchange ended higher Tuesday, tracking stronger soyoil and crude oil futures in Asian trading hours, trade participants said. The benchmark September CPO contract on the Bursa Malaysia Derivatives ended MYR11 higher at MYR2,400 a metric tonne.