August 6, 2009

Soy futures fell on the Dalian Commodity Exchange Thursday, dragged by a broad retreat among commodities after China's central bank said Wednesday it would "fine-tune" domestic policy to control rising prices, which some interpreted as code for potentially tightening credit.

 

The benchmark January 2010 soy contract fell 1% to RMB3,699 a metric tonne.

 

But as markets stabilized in the late session, analysts said long positions still dominate.

 

"The market hasn't given up and soy's downside is not big, unless more discouraging news or data emerge," said Gao Yanrong of Dalu Futures.

 

Electronic trading on the Chicago Board of Trade in Asian trading hours sent soy futures into retreat, after the bourse closed higher Wednesday on the back of a fluctuating session as traders vacillated between high-yield crop conditions and the crop's slow development.

 

China's soy prices were also supported by relatively tight supply in the spot market, with weather conditions posing more potential difficulties for this year's harvest, Gao said.

 

Corn, soymeal, palm and soyoil futures fell Thursday.

 

Thursday's settlement prices in yuan a metric tonne for benchmark contracts and volume for all contracts in lots (One lot is equivalent to 10 tonnes):

                             

Contract        Settlement       Price         Change        Volume

Soy               May 2010        3,699        Dn   34         184,902

Corn              May 2010       1,666         Dn    5           48,706

Soymeal        May 2010        2,933        Dn   69      2,454,324

Palm Oil         May 2010        6,366        Dn   92         650,802

Soyoil            May 2010        7,526        Dn  122     1,009,300