June 25, 2008
Wednesday: China soybean futures settle up a tad on US weather concerns
Soybean futures traded on the Dalian Commodity Exchange settled slightly higher Wednesday on concerns over U.S. weather conditions.
Analysts said consolidation of soy futures is likely to continue for a while before the weather conditions point out a clear direction.
The benchmark January 2009 soybean contract rose RMB25 to settle at RMB4,927 a metric tonne after trading between RMB4,858 and RMB5,000/tonne.
"There are a couple of supportive and negative factors that have made the outlook murky, and the focus is on the U.S. weather conditions," said Zeng Xuezhou, an analyst at Beite Futures.
DTN/Meteorlogix said that for the last half of the week, forecast models have taken a look toward more rain in the central U.S., fueling concerns about crop quality and flooding.
But at the same time, current record prices make any further advancement difficult, Zeng said.
Soymeal futures settled higher, but soyoil futures settled down.
Analysts said as cash prices of soymeal are higher than futures prices, soymeal futures might see further gains, while soybeans and soyoil are likely to be weaker in the near term on seasonally weak demand.
Corn futures settled down a tad.
Cash prices in the meantime remained largely stable, and analysts expect little change in the next couple of weeks.
In the major production regions in the northeast, farmers' inventories have fallen to very low levels, but buying interest from corn processing firms has also been shrinking due to smaller profit margins following a continuous rise in production costs, said traders.
Wednesday's settlement prices in yuan a metric tonne and the volume for all contracts in lots:
Contract Settlement Price Change Volume
Soybeans Jan 2009 4,927 Up 25 607,332
Corn Jan 2009 1,916 Dn 10 398,950
Soymeal Jan 2009 3,923 Up 55 633,126
Palm Oil Sep 2008 10,398 Dn 88 16,326
Soyoil Sep 2008 11,454 Dn 62 125,950
