July 24, 2006

 

Monday: China soybean futures settle lower on CBOT losses

 

 

Soybean futures traded on China's Dalian Commodity Exchange settled mostly lower Monday, following Friday's losses on the Chicago Board of Trade, analysts said.

 

The benchmark September contract settled RMB24 lower at RMB2,437 a metric tonne, after trading between RMB2,429/tonne and RMB2,446/tonne.

 

Total trading volume fell to 35,540 lots from 43,688 lots Friday. One lot is equivalent to 10 tonnes.

 

"Soybean futures prices fell in the morning session on CBOT Friday losses and rebounded slightly, following (electronic trading) CBOT gains," said Shi Junfeng, an analyst at Tianma Futures Co.

 

"Prices of pork and eggs increased a little bit recently, which may be a sign of recovery for the feed industry. Soybean futures prices will at least hold at the current level and may rebound in August and September if CBOT prices pick up," Li Honglei, an analyst at Nanhua 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 RMB2,473/tonne, down RMB13.

 

Soymeal futures settled lower. The benchmark November 2006 soymeal contract fell RMB21 to settle at RMB2,221/tonne, after trading between RMB2,204/tonne and RMB2,237/tonne.

 

Total trading volume for all soymeal contracts dropped to 291,862 lots from 347,540 lots Friday.

 

"The harvest of soybeans will decline as the acreage has decreased by an average of 30% in major soybean-producing regions this year, which will lend support to futures prices of soybean and soymeal," said Li.

 

Soyoil futures settled higher. The most active September 2006 soyoil contract rose RMB68 to settle at RMB5,318/tonne.

 

"In addition to rising crude oil prices in recent days, reduced production of rapeseed oil also lent support to soyoil future prices," Li added.

 

Corn futures settled lower. The most widely held March 2007 contract settled at RMB1,382/tonne, down RMB21.

 

"The decrease in spot market prices pressured futures prices of corn," Shi said.

 

Total trading volume for corn rose to 555,978 lots from 531,208 lots Friday.