July 31, 2007

 

CBOT Soy Review on Monday: Higher; soyoil, weather supply support

 

 

Chicago Board of Trade soybean futures settled with moderate gains Monday, ending near session highs in quiet trading.

 

August soybeans rose 7 1/4 cents to US$8.22 3/4, and November soybeans also ended 7 1/4 cents higher, at US$8.47 3/4. August soymeal fell 70 cents to US$212.90, while August soyoil rallied 64 points to 37.40.

 

Soybeans were supported by the strength in soybean oil and supportive near-term weather forecasts, said Jack Scoville, an analyst at Price Futures Group. Soyoil helped support soybeans quite a bit as oil derived its strength from sharply higher palm oil prices overnight, he said.

 

Soybeans were underpinned to an extent by hot and dry near-term weather forecasts, but the upside was capped by longer-term outlooks indicating rain at week's end, an E-CBOT trader said.

 

DTN Meteorologix Weather predicts a hot and dry pattern through the first half of the week in the U.S. Midwest, depleting soil moisture and increasing stress on pod-filling soybean plants. Longer-term forecasts predict the potential for significant rain in the region, Meteorologix Weather said.

 

The weather is not bad but not perfect either, with warm and dry weather supporting the market, Scoville said.

 

Export inspections were in line with analyst expectations and nothing special, a trader said.

 

The U.S. Department of Agriculture reported soybeans inspected for export totaled 7.537 million bushels for the week ended July 26, within the 6 million to 12 million bushels forecast by analysts.

 

Near the close, soybeans saw some additional strength as people evened up some of their positions before Monday afternoon's crop progress report, the E-CBOT trader said. Analysts expect soybean conditions unchanged to down three percentage points from last week's 61% good-to-excellent rating.

 

Price direction on Tuesday will depend on the crop progress report as well as the overnight weather forecasts, a commission house analyst said.

 

In open auction trading, Rand bought 200 November and Man Financial sold 200 November. Commodity fund buying was estimated at 1,000 contracts.

 

In options trading, Man Financial sold 700 November US$9.20 calls and UBS sold 300 September US$8.20 puts.

 

 

SOY PRODUCTS

 

Soymeal and soyoil futures finished mixed Monday as stronger prices for Malaysian palm oil overnight and speculative buying pushed soyoil prices higher, analysts said. Palm oil was up 2% overnight and soyoil rose in response, said Scoville. Soymeal ended lower as light oil/meal spreading limited buying interest, a commission house analyst said.

 

August oil share ended at 46.76% and the August crush ended at 57 cents.

 

In soymeal trades, Fimat bought 600 December and JP Morgan sold 100 August. In soyoil trades, Tenco bought 300 September and JP Morgan sold 300 September and 600 December.

 

Commodity fund buying was estimated at 2,000 contracts in soyoil while funds sold 1,000 soymeal.

 

On Monday, the U.S. Department of Agriculture is scheduled to release the weekly crop conditions report for the week ended July 29 at 4 p.m. EDT (2000 GMT).