August 21, 2006
Monday: China soybean futures settle mostly down on CBOT losses
Soybean futures traded on China's Dalian Commodity Exchange settled mostly lower Monday, pressured by Friday's losses on the Chicago Board of Trade, analysts said.
The most active January 2007 contract settled RMB4 lower at RMB2,556 a metric tonne, after trading between RMB2,546 and RMB2,563/tonne.
Total trading volume shrank to 17,756 lots from 34,484 lots Friday. One lot is equivalent to 10 tonnes.
"CBOT losses put pressure on soybean futures. Moreover, trading volume was very thin, showing speculators preferred soymeal and corn futures to soybean futures," said Zeng Xuezhou, an analyst at Beite Futures Co.
No. 2 soybean contracts, which are encouraged to be delivered with soybeans harvested from genetically modified crops, settled mostly lower. The benchmark September contract fell RMB15 to RMB2,451/tonne.
Soymeal settled mostly lower. The benchmark January 2007 soymeal contract fell RMB8 to settle at RMB2,255/tonne, after trading between RMB2,244 and RMB2,264/tonne.
Total trading volume for soymeal fell to 161,010 lots from 234,874 lots Friday.
"The recovery in prices for pork and poultry offered some support to soymeal futures. However, feed companies, seeing no large increases in sales, have not increased their demand for soymeal significantly," said Zeng.
Soyoil settled mostly higher. But the most widely held November 2006 soyoil contract fell RMB2 to settle at RMB5,456/tonne.
"Prices for November contracts fell largely on profit taking by speculators," Zeng said.
Corn futures settled lower. The benchmark May 2007 contract settled RMB1 lower at RMB1,421/tonne.
Total trading volume for corn fell to 410,850 lots from 599,778 lots Friday.
"Corn futures fell after five days of gains, pressured by rainy conditions in China's southwest, which has been hit by the worst drought in 50 years this summer. However, futures will post a strong rebound if spot market prices are still holding at a high level when the new harvest of corn comes to the market in September and October," Zeng added.
