October 25, 2007

 

Thursday: China soybean futures settle down; correction after new high

 

 

Soybean futures traded on the Dalian Commodity Exchange settled lower Thursday as traders were reluctant to push contracts higher amid a lack of bullish news.

 

The benchmark May 2008 soybean contract settled RMB16 lower at 4,302 a metric tonne.

 

Total trading volume rose to 1,012,584 lots from 965,736 Wednesday. One lot is equivalent to 10 tonnes.

 

Traders needed to pause after DCE soybean contracts settled at new highs Wednesday, analysts said.

 

"Investors were not as determined as previously (in pushing prices higher), and the market is likely to consolidate at current levels before it's ready for a further rise," said Wang Lin, an analyst at COFCO Futures.

 

Soybean demand remains strong despite lower imports last month.

 

China imported 1.89 million tonnes of soybean in September, up 5.5% from a year earlier, but much lower than the around 3 million tonnes it imported in each of the past few months, according to data issued by the General Administration of Customs Thursday.

 

The lower imports were due to higher soybean prices at the Chicago Board of Trade and rising freight fees, said Shao Yuanhui, a manager at Bohai Futures.

 

He expects high domestic inflation will continue to push the prices of agricultural products higher.

 

China's consumer price index rose 6.2% in September from a year earlier, less than the 6.5% gain in August.

 

Soymeal futures and soyoil futures settled mostly lower.

 

The benchmark May 2008 soymeal contract settled RMB24 lower at RMB3,252/tonne, and the benchmark May 2008 soyoil contract settled RMB16 lower at RMB8,700/tonne.

 

Corn futures settled lower. The benchmark May 2008 contract was RMB7 lower at RMB1,641/tonne.

 

The total trading volume of all corn futures rose to 335,810 lots from 319,108 lots Wednesday.