June 30, 2009

 

CBOT Soy Outlook on Tuesday: Steady, firm; supportive USDA acreage data

 

 

Chicago Board of Trade soybean futures are expected to start Tuesday's day session steady to firm following the U.S. Department of Agriculture's acreage and quarterly stocks report.

 

CBOT soybean futures are seen opening steady to 7 cents higher.

 

The USDA's acreage estimate is a supportive feature for soybean futures, but sharply lower calls for corn and weakness in wheat is seen taking some edge off prices, analysts said.

 

Corn futures are called to open 10 cents to 20 cents lower.

 

However, regardless of the price movement, the nearby July future is expected to continue to gain at the expense of new crop contracts as tight supplies remain an issue moving forward in the marketing year, analysts said.

 

The USDA estimated U.S. 2009-10 soybean planted acreage at 77.483 million acres, below- the average analyst estimate of 78.305 million.

 

"For the rest of the summer, it means that soybeans are the crop that's at risk while corn has a safety net," said Arlan Suderman, analyst with Farmer Futures.

 

The acres figure is up 2 percent from last year. The area for harvest is forecast at 76.5 million acres, up 3 percent from 2008, and will be the largest harvested area on record, if realized. The figure is up from USDA's March 31 planting estimate of 76.024 million. U.S. soybean planted acreage was 75.718 million in 2008.

 

"Soybean acreage was surprising, coming in about [a] million below the average trade estimate, particularly with all reports we have heard form the corn-belt," said Darrell Jobman, senior analyst with TraderPlanet.com in Kenosha, WI.

 

Soybean stocks as of June 1 were 597 million bushels, lower-than-the average estimate of 586 million bushels from a Dow Jones Newswires survey. U.S. soybean stocks totaled 676 million on June 1, 2008. Indicated disappearance for the March 2009 - May 2009 quarter totaled 705 million bushels.

 

A market technician said first resistance for November soybeans is seen at Monday's high of US$9.97 3/4 and then at US$10.00. First support is seen at Monday's low of US$9.80 and then at US$9.75.

 

DTN Meteorlogix said scattered showers are forecast for the eastern Midwest, with mostly dry conditions in the western belt. Mostly dry conditions or a few showers are on tap for northeast Midwest, while developing showers and thunderstorms move southwest Friday and Saturday. Temperatures will be near to below normal.

 

In demand news, USDA announced on Tuesday private exporters reported the sale of 113,000 metric tonnes of soybeans for delivery to China in the 2009-10 marketing year.

 

In overseas markets, soybean futures traded on the Dalian Commodity Exchange settled higher Tuesday, ahead of the release later in the global day of a possibly unfavorable U.S. Department of Agriculture report. The benchmark January 2010 soybean contract settled RMB16 a metric tonne higher at RMB3,653/tonne.

 

Crude palm oil futures on Malaysia's derivative exchange ended lower Tuesday in volatile trade as participants liquidated long positions after prices fell below the key support level of MYR2,250 per metric tonne. The benchmark September contract on the Bursa Malaysia Derivatives ended MYR32 lower at MYR2,230 a metric tonne.