October 22, 2009

 

CBOT Soy Outlook on Thursday: Seen lower, eyeing outside markets

 

 

Soybean futures on the Chicago Board of Trade are seen starting Thursday's day session on the defensive, garnering pressure from early strength in the U.S. dollar.

 

CBOT soybean futures are seen starting 4 to 6 cents lower. In overnight trade, Nov soybeans were 7 1/2 cents lower at US$10.01, and Jan soybeans were 8 1/4 cents lower at US$10.01 1/2.

 

The higher U.S. dollar will weigh on futures, with bearish signals from lower crude oil and metal prices adding to the weak outside market influence, said Vic Lespinasse, analyst with Grainanalyst.com.

 

However, as was the case Wednesday, price direction can change on a dime if the dollar reverses course, he added.

 

Harvest stalling rains forecast for the Midwest this week and next week remains a supportive feature to underpin prices. Additional support will be absorbed from solid weekly export sales.

 

Traders will eye price movement near the US$10.00 per bushel level basis front month contracts, with participants looking for signs of technical strength or weakness near that psychological level.

 

A technical analyst said first resistance for November soybeans is seen at Wednesday's high of US$10.15 and then at US$10.25. First support is seen at US$10.00 and then at US$9.80.

 

The DTN Meteorlogix weather forecast said rain, thunderstorms, wind and some snow will likely mean continued harvest delays for the Midwest region during the last part of this week and probably next week as well. Meanwhile, in the Delta, rain returns to the region today, likely delaying the crop harvests again, Meteorlogix said.

 

The U.S. Department of Agriculture reported total weekly soybean export sales for the 2009-10 marketing year were a net 987,300 metric tonnes for the week ended Oct. 15. The primary buyer was China with 741,500 tonnes. Analysts had forecast sales between 550,000 and 900,000 metric tonnes.

 

Soymeal sales were a net 115,700 tonnes. Trade estimates ranged from 100,000 to 275,000 tonnes. Soyoil commitments were 23,300 metric tonnes. Analysts had forecast sales between 10,000 and 25,000 tonnes.

 

U.S. soybean crushings totaled 113.975 million bushels in September, according to data released by the U.S. Census Bureau Thursday. On average, analysts anticipated a 113.7 million-bushel crush, according to a Dow Jones Newswires survey. The data is a reflection of slower processor activity due to limited soybean availability, analysts said. Crushings were down from 119.8 million bushels a month earlier, and from 125.7 million bushels a year earlier. Soymeal stocks for September totaled 239,179 short tonnes, compared with the average estimate of 296,250. Soyoil stocks totaled 2.880 billion pounds. Analysts, on average, expected 2.784 billion pounds.

 

In overseas markets, China's soybean futures traded on the Dalian Commodity Exchange settled higher Thursday, supported by a rise on CBOT and higher crude oil prices overnight. The benchmark May 2010 soybean contract settled 0.3% higher at RMB3,747 a metric tonne.

 

Crude palm oil futures on Malaysia's derivatives exchange ended up Thursday as investors covered short positions while the overnight jump in crude and soyoil prices were supportive, trade participants said. The benchmark January contract on the Bursa Malaysia Derivatives ended MYR42 higher at MYR2,210 a metric tonne.