August 19, 2008
Tuesday: China soybean futures settle slightly down; market remains cautious
Soybean futures traded on the Dalian Commodity Exchange settled mostly lower Tuesday as the market remained cautious amid expectations of a stronger dollar.
The benchmark January 2009 soybean contract settled RMB5 lower at RMB4,175 a metric tonne after trading in a range of RMB4,137-RMB4,213/tonne.
The dollar's rebound is likely to continue in line with the U.S. government's bullish dollar policy, which is aimed at curbing high crude oil prices that have added too much pressure to the U.S. economy, said Xiao Jun, an analyst at commodity consultancy Shanghai JCI.
Despite an overnight surge in soybean futures on the Chicago Board of Trade, the benchmark soybean contract opened lower Tuesday, indicating doubt over whether the fall in crude oil prices has ended, said Liu Fangat, an analyst at Datong Futures Brokerage Co.
The entry of short-term speculative funds helped push prices slightly into positive territory during the morning session, but cautiousness prevented any big rise.
Open interest for all soybean contracts totaled 381,612 lots at the end of the day, down 16,320 lots from Monday.
Ample cash soybean supply further exacerbated the weak sentiment.
Imported soybean stocks at Chinese ports are estimated at 3.85 million tonnes, continuing an upward trend, according to data from Tianqi Futures.
Soyoil futures and palm oil futures settled higher, while corn futures and soymeal futures settled lower.
Cash demand for soymeal and soyoil improved somewhat this week, with prices of the soy products rising slightly.
Tuesday's settlement prices in yuan a metric tonne and the volume for all contracts in lots (One lot is equivalent to 10 tonnes):
Contract Settlement Price Change Volume
Soybean Jan 2009 4,175 Dn 5 1,062,448
Corn Jan 2009 1,713 Dn 19 499,112
Soymeal Jan 2009 3,492 Dn 9 1,039,012
Palm Oil Jan 2009 7,600 Up 50 26,940
Soyoil Jan 2009 8,870 Up 76 582,782
