July 11, 2006

 

Tuesday: China soybean futures settle down despite CBOT gains

 

 

Soybean futures traded on China's Dalian Commodity Exchange settled lower Tuesday on weak fundamentals, despite overnight gains in Chicago Board of Trade soybean futures, analysts said.

 

The benchmark September contract fell RMB19 to settle at RMB2,525 a metric tonne, after trading between RMB2,500 and RMB2,544/tonne.

 

Total trading volume for all soybean contracts rose to 47,624 lots from 41,644 lots Monday. One lot is equivalent to 10 tonnes.

 

"The rises on CBOT lent support to soy futures, but soybean's fundamentals remain weak. Oversupply and sluggish demand persist. Speculators are reluctant to trade in soybeans," said Zeng Xuezhou, an analyst at Beite 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 RMB2,510/tonne, down RMB4.

 

Soymeal futures settled mostly higher, in line with CBOT's overnight gains. The benchmark November 2006 soymeal contract rose RMB6 to settle at RMB2,318/tonne, after trading between RMB2,296 and RMB2,338/tonne.

 

Total trading volume for all soymeal contracts rose to 320,318 lots from 210,686 lots Monday.

 

"China's animal feed industry is showing signs of a recovery. Demand for soymeal is likely to increase," Zeng said.

 

Corn futures settled higher. The most widely held March 2007 contract settled at RMB1,434/tonne, up RMB4.

 

Total trading volume for all corn contracts rose to 656,500 lots from 633,006 lots Monday.

 

"China's demand for corn continues to rise. Corn futures can expect a bull market in the long run," Zeng added.

 

Soyoil futures settled higher. The most widely held September 2006 soyoil contract rose RMB17 to settle at RMB5,228/tonne.