July 27, 2007

 

Friday: China soybean futures settle mixed; supply pressure to ease

 

 

Soybean futures traded on the Dalian Commodity Exchange settled mixed Friday after a quiet overnight session on the Chicago Board of Trade.

 

The benchmark January 2008 soybean contract settled RMB1 higher at RMB3,307 a metric tonne.

 

Total trading volume rose to 169,554 lots from 165,056 lots Thursday. One lot is equivalent to 10 tonnes.

 

Domestic purchasers are more willing to import soybeans after soybean futures on CBOT fell back from record highs of above $9 a bushel, said the China National Grain and Oils Information Center.

 

But traders expect soybean imports to fall to around 2 million tonnes a month in the next two to three months, which is traditionally the low season for soymeal trade, as hot weather makes it difficult to preserve soymeal.

 

During April to June, the country imported 2 million to 3 million tonnes of soybeans each month.

 

The reduced supply will help support soybean and soymeal prices, they said.

 

Soymeal futures settled lower, but soyoil futures settled mostly higher.

 

The benchmark January 2008 soymeal contract settled RMB7 lower at RMB2,558/tonne, and the most heavily traded January 2008 soyoil contract settled RMB8 higher at RMB8,172/tonne.

 

Corn futures settled higher.

 

The benchmark January 2008 contract settled RMB11 higher at RMB1,495/tonne.

 

Trading volume for all corn contracts declined to 407,752 lots from 546,568 lots Thursday.

 

But traders expect the current pork shortage, which is likely to continue until early next year, to continue to put pressure on domestic corn prices.