August 7, 2009

 

CBOT Soy Review on Thursday: Falls on profit-taking, dollar, weather

 

 

Profit-taking, pressure from outside markets and easing weather worries knocked down Chicago Board of Trade soy futures Thursday, analysts said.

 

September soys slipped 8 1/2 cents at US$10.79 1/2 a bushel, and November soys sank 15 cents to US$10.30. December soymeal dropped US$4.10 to US$314.50 per short tonne, and December soyoil lost 69 points to 37.54 cents per pound

 

Strength in the U.S. dollar and weak crude oil weighed on agricultural markets, with CBOT corn and wheat also finishing lower, traders said. Commodity funds sold an estimated 4,000 soy contracts.

 

Traders took some money off the table as concerns eased about hot weather expected in the U.S. Midwest, analysts said. Forecasts show temperatures will not be "blistering for a long period of time," said Joe Victor, vice president of marketing for Allendale.

 

Expectations that rain will accompany high temperatures helped lessen traders' worries, an analyst said. Late next week, it's likely that "hot weather should focus on the Plains - clipping corn and soys," according to an updated forecast from T-Storm Weather.

 

Weather is key to soys because August is a critical month for development. The market will continue to keep a close eye on forecasts for at least the next two weeks, Victor said.

 

In other news, weekly U.S. soy export sales were strong, which helped underpin old-crop August and September contracts, he said. Total export sales for the week ended July 30 were 2.9 million tonnes, above expectations for 2.2 million to 2.5 million tonnes.

 

"The weather doesn't have much influence on the old crop," Victor said. "The sales do."

 

Traders are looking ahead to the release of the U.S. Department of Agriculture crop production and supply/demand reports Aug. 12. The reports will include fresh estimates on U.S. soy production and yield.

 

 

Soy Products

 

CBOT soy product futures closed weaker with soys. Strength in the U.S. dollar set a bearish tonnee for the complex, traders said. Commodity funds sold an estimated 1,000 soyoil contracts and were seen as even in soymeal.

 

Total weekly U.S. soymeal export sales of 82,100 tonnes were within trade estimates, while soyoil sales of 102,400 tonnes were below expectations.