July 30, 2009
CBOT Soy Outlook on Thursday: Up on outside markets, export sales
Bullish outside financial market influences coupled with strong weekly export sales have Chicago Board of Trade soybean futures poised for a firm start to Thursday's day session.
CBOT soybean futures are seen opening 15 cents to 25 cents higher.
CBOT soybean prices were higher overnight. August rose 25 cents a bushel to US$10.82 1/2 and November climbed 15 cents to US$9.31.
The market rallied overnight with buyers inspired by weakness in the U.S. dollar, higher crude oil, precious metals and advances in equities, analysts said. The strength from outside markets is expected to carry over into Thursday's day session.
Higher-than-expected weekly export sales data is seen buoying the market as well. The sales report will add more "fuel to the bullish fire," said Victor Lespinasse, analyst with Grainsanalyst.com.
Bull spreading is seen continuing, with tight old crop inventories, strong demand and reports of strong cash premiums in South America underpinning nearby contracts. A lack of threatening weather for developing crops is seen limiting new crop advances, aiding the strength in bull spreads.
Nevertheless, futures remain in a sideways trading pattern on technical charts, chopping around within a 3-week trading range.
A market technician said first resistance for November soybeans is seen at US$9.25 and then at Wednesday's high of US$9.35 3/4. First support is seen at Wednesday's low of US$9.06 1/4 and then at US$9.00.
DTN Meteorlogix said below normal temperatures will continue to slow crop development in the U.S. Midwest during the next 5 days. There is some chance for a more favorable temperature pattern longer range but this is uncertain. There is no significant heat stress expected during the next 7-10 days.
The U.S. Department of Agriculture reported total weekly soybean export sales were a net 954,500 metric tonnes for the week ended July 23. Sales for 2009-10 were a net 708,900 metric tonnes. China bought 460,000 tonnes of new crop beans. Analysts had forecast sales between 400,000 and 650,000 metric tonnes.
Soymeal sales were a net 408,000 tonnes. Trade estimates ranged from 55,000 to 130,000 tonnes. Soyoil commitments were 29,700 metric tonnes. Analysts had forecast sales between 20,000 and 100,000 tonnes.
USDA also announced on Thursday private export sales of 1.92 million metric tonnes of soybeans for delivery to China. Of that total, 1.8 million tonnes are for delivery in the 2009-10 marketing year and 120,000 tonnes are for delivery in the 2008-09 marketing year.
The U.S. Census Bureau Thursday revised its June soyoil stocks estimate to 3.407 billion pounds, up slightly from its preliminary estimate of 3.403 billion pounds, according to the Census Bureau's Fats and Oils stocks report.
In overseas markets, China's soybean futures traded on the Dalian Commodity Exchange settled little changed Thursday as traders stayed on the sidelines, awaiting government policies. The benchmark May 2010 soybean contract settled RMB1 lower at RMB3,527 a metric tonne.
