CBOT Soy Outlook on Monday: Down 2-4 cents; bearish weather, follow-through sales
CBOT soybean futures are seen opening 2 cents to 4 cents lower.
CBOT soybean prices were lower overnight. August fell 3/4 cent a bushel to US$10.20 1/4 and November slid 6 cents to US$9.09.
Continued favorable Midwest crop weather serves as the catalyst for a defensive theme, but traders said soybean futures remain subject to big price swings as participants eye outside markets and potential shifts in weather patterns.
The market has a "me too" attitude, as analysts anticipate strong crop ratings for corn could translate into big yields for U.S. soybeans as long as weather conditions hold constant, said Don Roose, president U.S. Commodities in West Des Moines, Iowa.
The absence of leadership from outside markets is seen aiding the lower tone, but firmer energy futures and a weaker U.S. dollar is expected to underpin prices.
Meanwhile, traders will keep a close eye on weather, as pockets of dryness in the western Midwest raise some concerns about the potential for a drier weather pattern during the critical pod setting stage of development for soybeans in August, Roose said.
A technical analyst said first resistance for November soybeans is seen at US$9.20 and then at US$9.25. First support is seen at US$9.00 and then at US$8.95.
DTN Meteorologix said there is still no sign of significant heat stress for Midwest crops either this week or next week. Rainfall should favor crops, except possibly in the northwest where totals could be lighter.
In the Delta this weather pattern looks to bring additional chances for rain to the region this week, Meteorlogix forecasts.
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.
In overseas markets, soybean futures traded on the Dalian Commodity Exchange settled lower Monday, tracking Friday's fall on CBOT. The benchmark May 2010 soybean contract settled RMB28 a metric tonne lower at RMB3,502/tonne.
Crude palm oil futures on Malaysia's derivatives exchange ended down in choppy trade Monday despite a rise in exports, as trade participants remained concerned the improvement in demand may not be sufficient to absorb end-July palm oil output. The benchmark October CPO contract on the Bursa Malaysia Derivatives ended MYR24 lower at MYR2,098 a metric tonne.
