June 23, 2006

 

CBOT Soy Review on Thursday: Lower; carves out new low for week

 

 

Chicago Board of Trade soybean futures ended lower across the board Thursday, carving out new lows for the week on speculative selling amid the absence of supportive features to underpin prices.

 

July soybeans ended 3 1/4-cent lower at US$5.83, November soybeans finished 4-cent lower at US$6.08 3/4, July soymeal settled US$1.60 lower at US$176.50 a short tonne, while July soyoil ended 5 points higher at 24.49 cent a pound.

 

Spillover weakness from neighboring grain futures coupled with good near-term weather conditions for crops across the Midwest weighed on prices, with futures attracting additional selling once active contracts pierced underlying technical support, analyst said.

 

Futures chopped around for most of the day, with supportive crush data and concerns over long range weather outlooks underpinning prices, while pressure was absorbed from good near term crop conditions. Traders said futures continued its consolidative action in quiet action, as the lack of fresh fundamental news failed to offer direction.

 

The disparity of weather models for the first half of July and with the market up in the air over how many acres the U.S. Department of Agriculture will trim off the March Planting intentions estimate in its June 30 acreage report promoted a sideways theme, said Dan Basse, president AgResource Co. in Chicago.

 

The crush number was supportive on the surface, but the NOPA crush report released last week prepared the market for the bounce in the number, said Basse adding that traders aren't willing to aggressively press the gas pedal in either direction, until they have more confidence in mother nature.

 

Meanwhile, the DTN Meteorlogix forecast said Wednesday's weather featured thunderstorms with up to 1 1/2 inches of rainfall from Kansas northeast to Michigan. Additional rainfall will develop Thursday into Saturday. The showers will produce rains ranging from one-half to 1 1/2 inches in an area extending from the Texas Panhandle to the Great Lakes. The rainfall will benefit soil moisture in corn and soybean, Meteorlogix said.

 

In pit trades, Citigroup bought 300 July, Fimat bought 300 July and 400 November, Gelber bought 500 July and 500 November, FCStonnee sold 300 November, and Fimat sold 400 November.

 

South American soybean futures ended lower, with the July future settling 10 cents lower at US$6.05.

 

 

SOY PRODUCTS

 

Soy product futures ended mixed Thursday, with soymeal futures succumbing to pressure from late declines in soybeans. Soymeal ended lower with beans, after holding gains for most of the day, benefiting from smaller-than-expected stocks numbers in the Census crush report. However, a lack of additional support left prices at the mercy of movements in soybeans, analysts said.

 

Soyoil futures ended the session with light gains, scaling back earlier advances on a late slide in soybeans. Light soyoil/soymeal spreading, and a census stock figure showing larger-than-expected domestic use in May provided fundamental support for soyoil to gain product share on the day, analysts said.

 

July oil share ended at 40.95%, and the July crush ended at 74 1/2 cents.

 

In soymeal trades, buyers and sellers were scattered among various commission houses.

 

In soyoil trades, buyers and sellers were scattered among various commission houses.