September 7, 2007

 

CBOT Soy Review on Thursday: Slips on profit-taking, correction

 

 

Chicago Board of Trade soybean futures tumbled Thursday on profit-taking as the trade digested bearish new estimates for the 2007-08 U.S. crop, analysts said.

 

September soybeans fell 11 cents to US$8.78 per bushel, and November soybeans closed down 10 1/2 cents at US$8.92 1/2. January soybeans slid 10 1/2 cents to US$9.08.

 

September soymeal finished US$2.60 lower at US$242.80 per short tonne, and December soymeal ended US$3.40 lower at US$249.20. September soyoil slipped 23 points to 37.08 cents per pound, and December soyoil settled 28 points lower at 37.72.

 

Long liquidation and commodity fund selling of an estimated 5,000 soybeans contracts pressured prices, a floor trader said. The market seemed to be "top heavy," he added. In pit trades, Fimat sold 1,000 November, while Goldenberg Hehmeyer and Rand Financial each sold 500 November.

 

Private analytical firm Informa Economics, meanwhile, issued new crop projections, which were seen as slightly bearish, traders said. Informa pegged the 2007-08 U.S. soybean crop at 2.664 billion bushels, with a yield of 42.1 bushels per acre.

 

The firm's estimate may have "added a little bit more credence to the idea that we'll have a good yield this year," said Anne Frick, senior oilseed analyst with Prudential Financial in New York. However, "the market was due to step back anyway after recent gains."

 

FC Stonnee on Wednesday afternoon released its crop estimates, putting the soybean crop at 2.682 billion bushels, with a yield at 42.4 bushels per acre.

 

"I think the FC Stonnee number last night was probably a little bit higher than people were looking for," Frick said. "That might have contributed to the sell-off overnight."

 

In the August supply and demand report, the U.S. Department of Agriculture estimated U.S. soybean production at 2.625 billion bushels with a yield of 41.5 bushels per acre. On Sept. 12, the USDA is scheduled to release updated U.S. corn and soybean estimates at 8:30 a.m. EDT (1230 GMT).

 

Looking ahead, the six- to 10-day weather outlook for the U.S soybean and corn belt is uncertain, according to DTN Meteorlogix. Additional harvest delays are in store for the eastern and southern Midwest, the firm said. In the western and northern Midwest, crop maturity may slow down due to the presence of cooler temperatures and showers.

 

The USDA at 8:30 a.m. EDT on Friday is slated to release export sales figures for the week ended Aug. 30. Trade expectations put sales in the range of 300,000 to 700,000 metric tonnes.

 

 

SOY PRODUCTS

 

CBOT soy product futures finished in negative territory, under pressure from fund selling and weakness in soybeans, traders said. Lower palm oil prices overnight also put a lid on buying interest in soyoil, an analyst said.

 

Commodity funds sold an estimated 1,500 soyoil contracts and 1,000 soymeal contracts. In soyoil pit trades, UBS sold 500 Oct and JP Morgan sold 400 Dec, while Citigroup and Fimat each bought 400 Dec. Tenco bought 800 Dec soyoil and sold 700 Dec soymeal.

 

Trade estimates peg weekly soymeal export sales at 75,000 to 225,000 tonnes and soyoil sales at none to 20,000 tonnes.