September 1, 2007

 

CBOT Soy Review on Friday: Slips on profit-taking, wheat setback

 

 

Chicago Board of Trade soybean futures slipped Friday on profit-taking as spillover support from the wheat market evaporated, traders said.

 

September soybeans fell 2 1/2 cents to US$8.68, up 19 cents on the week. November soybeans ended down 2 1/2 cents at US$8.82 1/2, up 17 1/2 cents on the week.

 

September soymeal ended US$0.20 lower at US$239.80 per short tonne, and December soymeal closed down US$0.90 at US$245.70. September soyoil settled 21 points higher at 36.54 cents per pound, and December soyoil rose 6 point to 37.11.

 

The soybean market felt early spillover support from a rally to fresh all-time highs in CBOT wheat futures. However, soybeans slumped as wheat pulled back during the session, traders said.

 

Wheat's setback provided soybean traders with "a perfect excuse for some pre-weekend profit-taking," an analyst said.

 

CBOT soybeans also felt some early strength from concerns about U.S. yields, a trader said. However, the worries seemed "unduly pessimistic," the analyst said.

 

Warm, dry weather is promoting rapid corn and soybean harvest progress across the Delta, and the U.S. Department of Agriculture said Gulf grain elevators saw commercial inventories of both commodities increase this week. More dry and warm weather is likely during the next five to six days over the Midwest, according to DTN Meteorlogix.

 

"This should help improve conditions in the wet areas of the west and north for maturing corn and late pod-filling soybeans after very heavy rain during August," the weather firm said about the warm, dry forecast.

 

However, there will be some increase in stress to late-filling crops in the Ohio Valley, Meteorlogix said. Shower chances return to the northern and central sectors during Sept. 9-10, the firm said.

 

Potential prospects for the further spread of Asian soybean rust will be poor this weekend, according to a new infection forecast issued by the USDA. The fungus is spread by wind-blown spores and can cause severe yield losses via rapid defoliation of infected soybeans.

 

"Conditions will continue to remain relatively poor for spore transport, due to the lack of a strong, persistent wind which will keep spores confined to locally diseased areas," the USDA said. "Showers and thunderstorms in the Gulf Coast states will allow for the potential of spore survival and deposition in already infected areas."

 

The CBOT is closed Monday in observance of Labor Day.

 

In CBOT pit trades, MF Global bought 500 Nov and sold 500 Nov. Fortis bought 500 Nov, while Tenco and Rand Financial each sold 500 Nov.

 

Deliveries posted against the CBOT September soybean future were 1,565 contracts. Large issuers included the customer account of the Astro division of UBS Securities which issued 1,278 contracts, and the customer account of R.J. O'Brien, which issued 257 contracts. Large stoppers included the house account of ADM Investor Services, which stopped 753 contracts, and the customer account of Man Professional Clearing, which stopped 225 contracts. The last trade assigned was Aug. 30.

 

 

Soy Products

 

CBOT soy product futures closed mixed as soymeal slipped under pressure from declines in soybeans, an analyst said. Soyoil finished firmer with modest support from light oil/meal spreading, a CBOT floor trader added.

 

Commodity funds bought an estimated 1,000 soyoil contracts. Players were scattered in soyoil pit trades, and Fimat bought 400 Dec soymeal.

 

Deliveries posted against the CBOT September soyoil future were 2,011 contracts. Deliveries posted against the CBOT September soymeal future were 261 contracts.