September 11, 2007

 

Tuesday: China soybean futures settle up on higher soyoil prices

 

 

Soybean futures traded on the Dalian Commodity Exchange settled higher Tuesday, supported by the surge in soyoil prices, analysts said.

 

The benchmark May 2008 soybean contract settled RMB38 higher at RMB3,999 a metric tonne, after trading between RMB3,970/tonne and RMB4,023/tonne.

 

Total trading volume rose to 703,410 lots from 691,200 lots Monday. One lot is equivalent to 10 tonnes.

 

Rising demand for edible soybean and expectations of lower domestic soybean output are likely to push domestic non-genetically modified soybean prices to RMB3,800/tonne by year end, compared with the current range at RMB3,300-RMB3,400/tonne, said Shanghai JCI.

 

China may see a decrease of at least 30% in soybean output this year due to drought and reduced acreage, against 16 million tonnes in 2006 analysts forecasted.

 

"The positive price outlook has been driving up soybean futures recently, offering underlying support even if there's any downward correction," said a trader in Beijing.

 

Soymeal and soyoil futures settled mostly higher.

 

The benchmark May 2008 soymeal contract settled RMB7 higher at RMB3,149/tonne. The benchmark January 2008 soyoil contract settled RMB210 higher at RMB8,252/tonne.

 

Soyoil futures were trying to catch up with the gains in soybean and soymeal futures after recent sluggish performance, analysts said.

 

As the Mid-Autumn Festival and National Day holidays are approaching, demand for soyoil has been rising, helping to push the prices of soybean and soy products higher.

 

"Not only prices of soybean and soy products, but also those of agricultural products face overall pressure to rise further due to limited land and water resources," said Li Honglei, an analyst at Nanhua Futures Co.

 

Corn futures settled mixed, with the benchmark May 2008 contract down RMB3 at RMB1,669/tonne.

 

Trading volume for all corn contracts fell to 594,174 lots from 740,040 lots Monday.