October 24, 2007

 

Wednesday: China soybean futures settle at fresh high on buying by funds

 

 

Soybean futures traded on the Dalian Commodity Exchange settled mostly higher Wednesday as funds snapped up contracts on a favorable global outlook.

 

The benchmark May 2008 soybean contract settled RMB31 higher at RMB4,318 a metric tonne, a new record high.

 

Total trading volume rose to 965,736 lots from 909,912 lots Tuesday. One lot is equivalent to 10 tonnes.

 

A forecast cut in global soybean output of 6% to 221.62 million tonnes in the 2007-08 crop year, according to data from U.S. Agriculture Ministry, provided a good buying opportunity for funds.

 

Open interest for soybean futures on the Dalian exchange exceeded 1 million lots, also a record high, indicating funds have a great interest in the contracts, said Dalu Futures.

 

Strong demand from the feedmeal sector during the winter will continue to push soybean prices higher, which may last until the Spring Festival in early February, it added.

 

Rising freight rates, which are still above $120/tonne from U.S. to Chinese ports, also helped support soybean prices.

 

Analysts expect the record high soybean prices to encourage farmers to plant more soybeans next year.

 

Soymeal futures settled mostly higher, while soyoil futures settled mixed.

 

The benchmark May 2008 soymeal contract settled RMB16 higher at RMB3,276/tonne and the benchmark May 2008 soyoil contract settled RMB12 higher at RMB8,716/tonne.

 

Corn futures settled higher.

 

The benchmark May 2008 contract settled RMB6 higher at RMB1,648/tonne.

 

Total trading volume for all corn futures declined to 319,108 lots from 404,144 lots Tuesday.