August 31, 2006

 

Thursday: China soybean futures settle higher on CBOT gains

 

 

Soybean futures traded on China's Dalian Commodity Exchange settled higher Thursday, following overnight gains on Chicago Board of Trade, analysts said.

 

The most active January 2007 contract settled RMB13 higher at RMB2,543 a metric tonne, after trading between RMB2,536/tonne and RMB2,555/tonne.

 

Total trading volume fell to 16,178 lots from 18,316 lots Wednesday. One lot is equivalent to 10 tonnes.

 

"Soybean futures posted a moderate rebound today, in step with gains on CBOT," said Dong Liang, an analyst at Great Wall Futures Co.

 

Tian Lianfeng, an analyst at Tianma Futures Co., concurred, adding the rebound probably won't last for long as the new soybean harvest is on the horizon.

 

No. 2 soybean contracts, which are encouraged to be delivered with soybeans harvested from genetically modified crops, settled higher. The benchmark September contract settled at RMB2,474/tonne, up RMB4/tonne.

 

Soymeal futures settled mostly higher. The benchmark January 2007 contract rose RMB14 to settle at RMB2,243/tonne, after trading between RMB2,236/tonne and RMB2,255/tonne.

 

Total trading volume for soymeal rose to 117,818 lots from 84,690 lots Wednesday.

 

"CBOT gains lent help to soymeal futures today. Whether the rebound can extend to tomorrow or next week will still depend on CBOT's performance," Dong said.

 

"I don't expect a full blown rebound in soymeal futures in the near future, as demand hasn't seen a major recovery," Tian added.

 

Soyoil settled mostly higher. The most widely held November 2006 contract rose RMB45 to settle at RMB5,487/tonne.

 

"It's an upward correction after days of retreats. Moreover, soymeal has better fundamentals, compared with soybean and soymeal," Tian said.

 

Corn futures settled mostly lower. But the benchmark May 2007 contract was unchanged at RMB1,394/tonne.

 

Total trading volume for corn rose to 440,534 lots from 394,214 lots Wednesday.

 

"Although corn prices have risen around RMB10-RMB20/tonne in southwestern provinces due to the drought, the spot market nationwide remains stable. A strong rebound is not probable as the new corn harvest is widely expected to be good," Tian added.