Friday: China soy futures settle up on higher crude, weaker dollar
Soy futures traded on the Dalian Commodity Exchange settled higher Friday on stronger crude oil prices and a weaker dollar overnight, despite a falling local equities and a mixed performance on the Chicago Board of Trade overnight.
The benchmark May 2010 soy contract settled RMB22 a metric tonne higher at RMB3,728/tonne, or up 0.6%.
"Soy contracts are in a dilemma of up or down as there is lack of guidance from (the CBOT)," said Qian Kun, an analyst with South China Futures Co.
Although the market still expects a good U.S. soy harvest this year, actual output could be less than earlier expected, and that could help to support prices, Qian said.
Expectations that domestic prices of major commodities will remain mostly stable ahead of the week-long holiday from Oct. 1, marking the 60th anniversary of the founding of the People's Republic, also helped to support market sentiment.
The country's economic planner said in statements Thursday that recent increases in China's meat and egg prices were temporary and won't lead to inflation. It said grain reserves are sufficient to maintain a balanced supply and demand situation that will help to guarantee stability in prices.
Overall, local sentiment toward agricultural commodities remains bullish due to ample cash liquidity, said Li Dongji, an analyst with Guotai Jun'an Futures Brokerage.
Trading volume of all soy contracts rose to 174,148 lots from 141,270 lots Thursday.
Open interest fell 7,792 lots to 296,614 lots Friday.
Corn futures, soymeal futures, soyoil futures and palm oil futures all settled higher.
Friday'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 3,728 Up 22 174,148
Corn May 2010 1,763 Up 12 403,896
Soymeal May 2010 2,926 Up 35 1,453,814
Palm Oil May 2010 6,520 Up 38 407,684
Soyoil May 2010 7,610 Up 32 674,232
