October 16, 2007

 

CBOT Soy Review on Monday: Climb on outside influences, harvest delays

 

 

Chicago Board of Trade soybean futures ended higher Monday, posting double-digit gains, as concerns over harvest delays and spillover strength from outside inflationary markets provided a spark.

 

November soybeans settled 10 1/4 cents higher at US$9.87 and January soybeans ended 10 1/2 cents higher at US$10.05 3/4. December soymeal settled US$2.30 higher at US$281.20. December soyoil finished 53 points higher at 40.06 cents a pound.

 

Sharply higher crude oil futures attracted speculative buyers in soyoil, which spilled over into soybeans, and when wet conditions causing harvest delays in the western Midwest were added, futures were firmly underpinned, said Brian Hoops, president of Midwest Market Solutions in Yanktonne, S.D.

 

Bullish underlying fundamentals with tightening stocks and strong global demand remain supportive features, with a higher-than-expected crush and export inspections figure providing further strength to buoy prices, analysts said.

 

The DTN Meteorlogix Weather Services forecast said more rain is expected Wednesday and Thursday in the western and northern Midwest, delaying the fall harvest. Most of the eastern Midwest was dry over the weekend, allowing harvest progress, but rain is expected Tuesday and more on Thursday.

 

In Brazil, the soybean growing state of Mato Grosso saw scattered showers and thundershowers over the weekend, which will improve soil moisture and allow for increased planting activities, Meteorlogix said. However, this is still below normal rainfall and temperature patterns remain above normal. Mato Grosso do Sul and Goias had only isolated activity during the weekend period, Meteorlogix added.

 

The National Oilseed Processors Association said Monday its September soybean crush rate was 139.8 million bushels. That was up from the August figure of 137.6 million bushels and above the 137.3 million at the same period last year. The average of estimates from analysts surveyed by Dow Jones Newswires was 136.7 million.

 

The U.S. Department of Agriculture reported 35.730 million bushels of soybeans were inspected for export in the week ended Oct. 11. Analysts surveyed by Dow Jones Newswires projected the inspections to fall within a range of 15 million to 34 million. Accumulated soy inspections total 106.574 million bushels, down 13.9% from the 123.765 million bushels reported at the same time last year.

 

In pit trades, speculative fund buying was estimated at 3,000 lots, Fimat and RJ O'Brien each buying 300 November. Fimat sold 400 January.

 

 

SOY PRODUCTS

 

Soy product futures ended higher, with soyoil the upside leader of the complex. Soyoil rallied, buoyed by spillover strength from sharply higher crude oil futures. The momentum from crude oil attracted speculative buyers, with optimistic outlooks for biodiesel encouraging speculative interest as well, analysts said.

 

Soymeal futures ended higher, taking on the role of a follower. The market moved higher in unison with the gains in the rest of the soy complex.

 

December oil share ended at 41.70% and the November/December crush ended at 72 1/4 cents.

 

In soymeal trades, buyers and sellers were scattered among various commission houses, with speculative funds net buyers of 2,000 lots.

 

In soyoil trades, buyers and sellers were scattered among various commission houses, with speculative funds net buyers of 2,000 lots.