July 10, 2006

 

Monday: China soybean futures settle lower amid ample supplies

 

 

Soybean futures traded on China's Dalian Commodity Exchange settled mostly lower Monday amid ample supplies.

 

The benchmark September contract dropped RMB33 to settle at RMB2,544 a metric tonnene, after trading between RMB2,522/tonnene and RMB2,575/tonnene.

 

Total trading volume for all soybean contracts rose to 41,644 lots from 22,472 lots Friday.

 

One lot is equivalent to 10 tonnenes.

 

"Farmers in northeastern China still hold 40%-50% of the crop in stocks, which put pressure on soybean futures prices," said Dong Liang, an analyst at Shanghai Jiuheng Futures Co.

 

No. 2 soybean contracts, which are encouraged to be delivered with soybeans harvested from genetically modified crops, settled lower.

 

The benchmark September contract settled at RMB2,514/tonnene, down RMB10.

 

"United States Department of Agriculture will publish a monthly report on commodities. Investors tend to be cautious before the issue of the report," Dong said.

 

Soymeal futures settled lower, in step with the fall in soybean futures.

 

The benchmark November 2006 soymeal contract fell RMB10 to settle at RMB2,312/tonnene, after trading between RMB2,303/tonnene and RMB2,325/tonnene.

 

Total trading volume for all soymeal contracts fell to 210,686 lots from 272,964 lots Friday.

 

"Currently, speculators prefer soymeal and corn to soybeans, so the trading of the two items has been relatively active," Dong said.

 

Corn futures settled lower. The most widely held March 2007 contract settled at RMB1,430/tonnene, down RMB18.

 

Total trading volume for all corn contracts rose to 633,006 lots from 611,768 lots Friday.

 

"Corn futures prices were pressured by large stocks of corn as well," Dong added.

 

Soyoil futures settled mostly lower. The most widely held September 2006 soyoil contract fell RMB9 to settle at RMB5,211/tonnene.