September 17, 2007

 

Monday: China soybean futures settle sharply up amid weather concerns

 

 

Soybean futures traded on the Dalian Commodity Exchange settled mostly up sharply Monday on continued worries that unfavorable weather conditions might further affect output this year, analysts said.

 

The benchmark May 2008 soybean contract settled RMB91 higher at RMB4,125 a metric tonne, after trading between RMB4,085/tonne and RMB4,156/tonne.

 

Total trading volume rose to 849,110 lots from 793,822 lots Friday. One lot is equivalent to 10 tonnes.

 

"Market talk about the frost in the major producing regions in the northeast further enhanced people's concerns over the output this year," said Li Honglei, an analyst with Nanhua Futures Co.

 

But the forward contracts aren't performing as strongly as near-month contracts, indicating that despite the supportive fundamentals, speculative buying on weather concerns seems to be a major driving force for higher prices, Li said.

 

Soymeal and soyoil futures settled higher, along with soybean futures.

 

The benchmark May 2008 contract settled RMB75 higher at RMB3,171/tonne. The most active May 2008 contract settled RMB140 higher at RMB8,464/tonne.

 

"The upcoming week-long holiday usually sees higher consumption of soyoil and poultry, which also helped to drive up prices," said Li.

 

Corn futures settled little changed. The benchmark May 2008 contract rose RMB1 to settle at RMB1,669/tonne.

 

Trading volume for all corn contracts rose to 577,390 lots from 347,952 lots Friday.