October 12, 2007

 

Friday: China soybean futures settle mixed ahead of USDA report

 

 

Soybean futures traded on the Dalian Commodity Exchange settled mixed Friday in shrinking trade, ahead of the U.S. Department of Agriculture's production, supply and demand reports to be released later in the day.

 

The benchmark May 2008 soybean contract fell RMB14 to settle at RMB4,186 a metric tonne, after trading between RMB4,163/tonne and RMB4,204/tonne.

 

Total trading volume fell to 736,664 lots from 812,526 lots Thursday. One lot is equivalent to 10 tonnes.

 

"What we have seen today is that speculative longs have flown into the market, especially in forward contracts, indicating overall bullish sentiment," said a trader in Beijing.

 

China's customs department said Friday that soybean imports in September fell to 1.89 million tonnes from 2.93 million tonnes in August.

 

The expectation of lower domestic output has led to higher prices on spot market in the past two weeks, with crushers keen to stockpile in case of more expensive soybean in the future.

 

Soymeal futures settled mixed. The benchmark May 2008 soymeal contract settled RMB7 lower at RMB3,168/tonne.

 

Soyoil futures settled higher. The benchmark May 2008 soyoil contract settled RMB60 higher at RMB8,606/tonne.

 

"The high ocean freight rates will keep the cost of imports high, underpinning soyoil prices," said Li Honglei, an analyst with Nanhua Futures Co.

 

Domestic crushers prefer to use imported soybean to crush for soyoil, as imports contain more oil.

 

Corn futures settled lower a tad. The benchmark May 2008 contract fell RMB15 to settle at RMB1,639/tonne.

 

Trading volume for all corn contracts rose to 383,662 lots from 522,932 lots Thursday.