Friday：China soy futures settle up tracking equities, CBOT

 

 

China's soy futures traded on the Dalian Commodity Exchange settled higher Friday tracking a surge in local equities and a rebound on the Chicago Board of Trade during China's week-long National Day holiday break.

 

The benchmark May 2010 soybean contract settled RMB61 a metric tonne higher at RMB3,609/tonne, or up 1.7%.

 

Gains in regional equities and metal prices during China's week-long holiday triggered broad interest in bluechips, sending domestic shares sharply up Friday when the market reopened.

 

The benchmark Shanghai Composite Index ended up 4.8% at 2,911.72, while the Shenzhen Composite Index rose 5.1% to 997.32.

 

CBOT soybean futures hit a near three-month low during China's long holiday, but rebounded on a weak dollar, weather concerns as well as overall strength in the commodities market.

 

Analysts said while a weak dollar and wet, cold weather conditions forecast for the U.S. Midwest are bullish features underpinning prices, the ongoing soybean harvest in China places downward pressure on prices.

 

The lack of clarity on government policies regarding soybean purchases this year has also created uncertainty in the market. The high level of government reserves continues to weigh on prices, and soy and soy products prices are likely to consolidate lower in the near term, Yu Haifeng, a Tianqi Futures analyst, said in a note.

 

Meanwhile, the U.S. Department of Agriculture is scheduled to release its crop production and supply and demand reports at 8:30 a.m. EDT Friday, and the market focus is on CBOT's reaction to them tonight.

 

The trading volume of all soybean contracts declined to 128,256 lots from 188,332 lots before the week-long National Day holiday.

 

The open interest fell 7,166 lots to 281,410 lots Friday.

 

Corn, soymeal, palm oil and soyoil futures all settled up.

 

Friday's settlement prices in yuan a tonne for benchmark contracts and volume for all contracts in lots (one lot is equivalent to 10 tonnes):  

 

Product    Contract    Settlement Price      Change     Volume

 

Soybean   May 2010      3,609                Up   61     128,256

Corn        May 2010       1,722                Up    1     50,094

Soymeal  May 2010       2,751                Up   51     630,878

Palm Oil   May 2010       5,876                Up  124    154,290

Soyoil     May 2010        6,886                Up  136    280,180