Tuesday: China soy futures rise; market sentiment focus on demand
Soy futures returned to positive territory on the Dalian Commodity Exchange Tuesday after plunging 3.6% a day earlier along with nervous global markets, as sentiment increasingly settled back on demand recovery and signs of price-supportive supply scenarios.
The benchmark May 2010 soy contract gained 0.2% to RMB3,658 a tonne.
"There's still good demand in China," said Tu Xuan, a soy analyst with Shanghai JC Intelligence Co.
"There's also a feeling that U.S. crop harvests might come in lower than forecast, which is good for prices."
Recent reductions in U.S. Department of Agriculture new crop yield, production and carryout projections have lent support to prices, though market bulls have remained cautious of aggressively testing for upside.
"The (global) supply pressures are still there," Tu said.
Soy futures on the Chicago Board of Trade fell Monday to their lowest levels in almost three weeks as a wet forecast for the U.S. Midwest this week fueled expectations of a large crop. Losses were pared during Asian trading hours Tuesday.
Further signs emerged Tuesday that Chinese soybean demand remains fairly healthy.
Private exporters reported sales of 118,000 tonnes to the U.S. Department of Agriculture for delivery to China for the 2009-10 marketing year, AgriCharts said Tuesday.
Corn, palm and soyoil futures gained Tuesday, while soymeal settled down.
Tuesday's settlement prices in yuan a tonnene for benchmark contracts and volume for all contracts in lots (one lot is equivalent to 10 tonnes):
Product Contract Settlement Price Change Volume
Soy May 2010 3,658 Up 8 252,140
Corn May 2010 1,731 Up 13 742,168
Soymeal May 2010 2,831 Dn 1 1,429,890
Palm Oil May 2010 6,352 Up 14 572,874
Soyoil May 2010 7,446 Up 24 859,062
