July 13, 2009

 

CBOT Soy Outlook on Monday: Down 7-9 cents on favorable crop weather

 

 

Chicago Board of Trade soybean futures are expected to start Monday's day session on the defensive, garnering pressure from favorable weather conditions for crop development in the central U.S.

 

CBOT soybean futures are seen opening 7 cents to 9 cents lower.

 

A technical analyst said first resistance for November soybeans is seen at Friday's high of US$9.24 and then at US$9.34. First support is seen at US$9.00 and then at Friday's low of US$8.88 1/4.

 

A quiet news front is expected to keep futures following the overnight theme early on, with weather the dominant issue affecting prices, said Don Roose, president U.S. Commodities in West Des Moines, Iowa.

 

More rain in the dry areas of the Delta and warm temperatures with scattered showers in the forecast for the Midwest will keep some weight on the market, Roose said.

 

Traders are seen eyeing outside financial markets for potential leadership, with a lack pressure from the U.S. dollar and crude oil lending some support for prices. A sideways theme is anticipated near term, but a decent finish to the market last week, is expected to strength following recent speculative long liquidation.

 

Meanwhile, traders are seen eyeing crop conditions, with a few dry pockets in parts of Nebraska and Minnesota expected to provide some support, Roose added.

 

The DTN Meteorlogix weather forecast said there is a mostly favorable weather pattern for developing soybeans in the Midwest. Hot temperatures, if any, will be brief and mainly confined to western and southern areas.

 

In the Delta, very hot temperatures last a few more days. Cooler weather and increasing shower activity is expected later this week and early next week, Meteorlogix said.

 

On tap for Monday, the U.S. Department of Agriculture is scheduled to release its weekly export inspections report at 11 a.m. EDT and its weekly crop progress report at 4 p.m. EDT. Analysts surveyed by Dow Jones Newswires expect crop ratings in a range of steady to down 2 percentage points.

 

In overseas markets, soybean futures settled slightly lower on the Dalian Commodity Exchange Monday, retreating under technical pressure after Friday's gains as supply concerns continued to build. The benchmark January 2010 soybean contract fell 0.1% to RMB3,533 a metric tonne.

 

Crude palm oil futures on Malaysia's derivatives exchange ended mostly lower Monday on long liquidation and renewed selling pressure after prices fell below the key support level of MYR2,000 per metric tonne, trade participants said. The benchmark September CPO contract on the Bursa Malaysia Derivatives ended MYR20 lower at MYR1,990/tonne.