Wednesday: China soy futures settle tad up in thin trade; consolidates
China's soy futures traded on the Dalian Commodity Exchange settled tad higher Wednesday with a very thin volume traded as participants stayed on the sidelines amid a consolidation in the market.
The benchmark May 2010 soy contract settled RMB5 a metric tonne higher, or 0.1%, at RMB3,726/tonne.
Strong demand, an ongoing drought in major producing areas in the northeast as well as a recovery in China's equity market helped support the prices, said analysts.
Bargain hunting prompted local shares to take a breath away from yesterday's sharp decline, with the benchmark Shanghai Composite Index ending up 1.8% at 2967.59 and the Shenzhen Composite Index gaining 2.8% to 1003.27.
Still, commodity investors are concerned about the durability of China's growth despite good U.S. economic data, said Commonwealth Bank in its research note Wednesday.
Soy and soy products are likely to consolidate higher in the near term as domestic supply pressure eases somewhat, said Tianqi Futures in a research report.
China's soy imports in August may fall sharply to 2.39 million tonnes, according to a Ministry of Commerce forecast, helping ease supply pressure as around 4.3 million tonnes of stock is still lying at ports.
Trading volume of all soy contracts declined to 197,430 lots from 340,896 lots Tuesday.
Open interest fell 574 lots to 306,576 lots Wednesday.
Corn futures settled lower, while soymeal, soyoil and palm oil settled slightly higher.
Wednesday'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 3,726 Up 5 197,430
Corn May 2010 1,737 Dn 3 184,810
Soymeal May 2010 2,909 Up 5 841,022
Palm Oil May 2010 6,522 Up 12 509,592
Soyoil May 2010 7,588 Up 48 794,358
