July 7, 2009

China's soy futures traded on the Dalian Commodity Exchange settled lower Tuesday, following losses on the Chicago Board of Trade overnight.

 

The most actively traded January 2010 soy contract settled RMB4 a metric tonne lower at RMB3,621/tonne.

 

The contracts opened lower, dragged down by CBOT counterparts that ended significantly lower Monday across the board on bearish outside markets and a favourable weather outlook.

 

A firmer U.S. dollar and sharply lower energy futures also weighed on a market that is lack trading guidance.

 

"FX markets will continue to be dictated by movements in equities but the lack of clear direction on this front suggests little appetite to break out of current ranges," said Calyon in its Asia Research issued Tuesday.

 

However, a tight domestic soy supply and the flood in some northeast major soy producing areas continued to limit the downward pressure.

 

Soy stocks at soy processing plants in the major producing province of Heilongjiang can only last for less than one month, and plants may have to stop production if the government doesn't release some of its millions of tonnes of reserves soon, an unnamed official at local Soy Industry Association said.

 

Trading volume of all soy contracts declined to 142,902 lots from 173,416 lots Monday.

 

Open interest rose 1,650 lots to 352,030 lots Tuesday.

 

Corn futures, soyoil futures and palm oil futures settled lower, while soymeal futures settled little changed.

 

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

              

Contract    Settlement     Price        Change      Volume

Soy            Jan 2010      3,621        Dn    4      142,902

Corn           Jan 2010      1,610        Dn    3      100,914

Soymeal     Jan 2010      2,886        Up    1    1,403,838

Palm Oil      Jan 2010      5,774        Dn   26      638,356

Soyoil         Jan 2010      7,186        Dn    8       934,938