July 6, 2007

 

Friday: China soybean futures settle down on sluggish demand

 

 

Soybean futures traded on the Dalian Commodity Exchange settled slightly lower Friday, pressured by sluggish demand from the feedmeal sector.

 

The benchmark January 2008 soybean contract settled RMB3 lower at RMB3,292 a metric tonne.

 

Total trading volume declined sharply to 83,054 lots from 144,722 lots Thursday. One lot is equivalent to 10 tonnes.

 

Traders said the contracts are unlikely to strengthen unless the weather turns bad.

 

"There are weather concerns for soybean growing in the U.S., which may help to push CBOT contracts higher next week, but the boost to domestic contracts could be very limited," said a trader at China National Cereals Trade Corp.

 

Soymeal futures settled mixed and soyoil futures settled higher.

 

The benchmark January 2008 soymeal contract settled RMB1 lower at RMB2,611/tonne, while the benchmark September 2007 soyoil contract settled RMB12 higher at RMB7,936/tonne.

 

Corn futures settled mixed.

 

The benchmark January 2008 contract settled RMB1 higher at RMB1,540/tonne.

 

Corn traders are reluctant to sell their stocks, which were bought earlier at higher prices.

 

But the ample stocks along with sluggish demand, due in part to the slow recovery of the feedmeal sector, may push corn prices lower later on, said analysts.

 

Some of them expected feedmeal demand to recover only at the end of this year or early next year.

 

Trading volume for all corn contracts declined to 358,202 lots from 605,674 lots Thursday.