September 19, 2007

 

Wednesday: China soybean futures settle down on pft-taking; corn lower

 

 

Soybean futures traded on the Dalian Commodity Exchange settled lower Wednesday on profit-taking, following strong gains in the past two sessions.

 

The benchmark May 2008 soybean contract fell RMB45 to settle at RMB4,109 a metric tonne, after trading between RMB4,055/tonne and RMB4,172/tonne.

 

Total trading volume rose to 1,035,290 lots from 774,764 lots Tuesday. One lot is equivalent to 10 tonnes.

 

"Futures prices need a healthy correction now, following strong gains," said Xu Yulan, an analyst with Yong'an Futures Co.

 

"As domestic cash values keep rising due to higher import prices, soybean futures have the potential to climb up further," Xu said, tipping technical support for the benchmark at RMB4,026/tonne.

 

Soymeal and soyoil futures settled mostly lower, in line with soybean futures.

 

The benchmark May 2008 soymeal contract settled RMB7 lower at RMB3,220/tonne. The benchmark May 2008 soyoil contract settled RMB140 lower at RMB8,356/tonne.

 

Corn futures settled a tad lower. The benchmark May 2008 contract fell RMB9 to settle at RMB1,661/tonne.

 

Trading volume for all corn contracts rose to 658,818 lots from 511,884 lots Tuesday.

 

"With the spot market remaining stable ahead of the new harvest, I don't think corn prices will come under heavy pressure from increased supply," said Liu Xinghua, an analyst with Great Wall Futures Co.

 

Although there are expectations of lower corn output this year, the government's control over the processing capacity expansion means prices lack the momentum for a jump, said Xu.