July 4, 2008

 

Friday: China soybean futures settle mixed; but benchmark up on CBOT

 

 

China's soybean futures traded on the Dalian Commodity Exchange settled mixed Friday, but the benchmark contracts were supported by gains on the Chicago Board of Trade overnight.

 

The benchmark January 2009 soybean contract settled RMB24 higher at RMB5,134 a metric tonne, or up 0.5%, after trading in the RMB5,080-RMB5,188/tonne range.

 

The September 2008 contract settled RMB26 higher at RMB5,786/tonne.

 

The benchmark contracts opened slightly higher and consolidated above and below the previous settlement price within a narrow range for most of the morning session, before finally rising further in the afternoon session.

 

"The sentiment recovered somewhat after panic selling yesterday, when the major funds turned their long positions into short positions," said Yu Haifeng, an analyst at Tianqi Futures.

 

However, the market is cautious after the prices of soybean futures surged to around RMB5,200/tonne from about RMB3,800/tonne in early April.

 

Although the farmers in Argentina have ended their strike, uncertainty remains since the revised soybean export tax hasn't been passed yet, said analysts.

 

Chinese importers bought 7-8 cargoes of soybeans this week, mostly from U.S. and Argentina, said commodity consultancy firm Shanghai JCI Friday.

 

Soybean oil, palm oil and corn futures settled lower, while soybean meal futures settled higher.

 

The surge in soy meal prices has led to a suspension in production at many feedmeal plants. Also, dwindling profits in the hog-raising sector has curbed the demand for soy meal.

 

But analysts said although the high soy meal prices have curbed some demand, the prices of futures may rise further to catch up with the gains in cash prices.

 

Soy meal cash prices in Rizhao city in Shandong province stayed in a RMB4,600-RMB4,760/tonne range, up from RMB4,450-RMB4,580/tonne in the previous week.

 

Friday's settlement prices in yuan a metric tonne and volume for all contracts in lots (One lot is equivalent to 10 tonnes):

 

Contract          Settlement          Price          Change          Volume

Soybean            Jan 2009          5,134          Up  24           767,578

Corn                 Jan 2009          1,925           Dn   4           155,202

Soymeal            Jan 2009          4,171          Up  51        1,289,950

Palm Oil            Sep 2008        10,580          Dn  20            14,312

Soyoil               Jan 2009         11,746         Dn 150           207,746