September 30, 2010

Indian soyoil futures fall again on weak global market

The refined soyoil futures fell for the third consecutive day on Wednesday (Sep 29) on extended selling pressure on a weak international market.

Investors and traders sold futures anticipating new crushing of soy will add to existing huge inventory of edible oils. Projection of bumper soy crop and forecast of record edible oil import in current as well as next oil year added woes to the market.

Moreover, weakness in international edible oil market also extended bearish strength to the Indian market. The refined soyoil futures are expected to extend its bearishness on Thursday (Sep 30) on follow through selling and taking cues from weak overseas market.

Traders are likely to sell futures anticipating build up in inventory of edible oil as the new crushing season has started in India. The country has huge stock of edible oil from heavy imports in recent months.

Projection of bumper soy crop in India is another bearish factor for the market. It is expected that India's edible oil imports in the oil year (November 2009-October 2010) is likely to be higher than last year.

CBOT soyoil futures ended down on reports of China would start selling edible oil from its reserve to bring down rising domestic prices.