October 25, 2007

 

CBOT Soy Outlook on Thursday: Seen Up 2-4 cents on outside market support

 

 

Chicago Board of Trade soybean futures are seen starting Thursday's day session higher, following the overnight theme, with outside markets influencing prices amid a lack of fresh directive news.

 

CBOT soybean futures are called to start the session 2 to 4 cents higher.

 

In overnight e-CBOT trading, November soybeans were 3 cents higher at US$9.79 1/4 per bushel, and January soybeans were 3 1/2 cents higher at US$9.97 1/4.

 

A quiet news front is expected to keep outside market influences in play, with weakness in the U.S. dollar and strength in inflationary markets supporting prices in early action, analysts said.

 

Otherwise, the market is expected to sustain the months trading range, with month crush and weekly export sales data in line with trade expectations, analysts added. Bullish long range fundamental outlooks are expected to keep a floor under prices, but without any significant U.S. harvest issues or planting concerns in Brazil upside potential seems limited in the absence of fresh news, a CBOT floor broker added.

 

A technical analyst said stochastics and the relative strength index remain neutral to bullish, signaling that sideways to higher prices are possible. If January soybeans renew the rally off this month's low, September's high crossing at US$10.33 is the next upside target, he said. Closes below Monday's low crossing at US$9.80 would help to confirm that a short-term top has been posted, he added.

 

The DTN Meteorlogix Weather Service forecast said drier weather conditions through the western U.S. Midwest are favoring late crop harvests. In Brazil, widespread rainfall for Mato Grosso, Mato Grosso do Sul and southern Goias will help improve soil moisture for early soybeans. New soybean areas of western Bahia Brazil look to continue a drier and much warmer than normal trend during the next week or more, Meteorlogix reports.

 

U.S. Department of Agriculture reported weekly soybean export sales were 463,400 metric tonnes for the week ended Oct. 18. The sales were primarily for Indonesia with 74,600 metric tonnes, and China with 71,700 tonnes. Analysts had forecast sales between 400,000 and 850,000 metric tonnes. Soymeal sales were a net 244,500 tonnes, and soyoil commitments were 24,300 metric tonnes.

 

The U.S. Census Bureau released its monthly soybean crush report, pegging the September crush at 147.498 million bushels, up from the August crush figure of 146.2 million bushels. In a survey of analysts by Dow Jones Newswires the average of estimates was 147.5 million bushels. August soymeal stocks reported at 351,322 short tonnes, up from the 236,948 tonnes reported for August, as well as above the average of estimates at 325,000. Soyoil stocks came in at 2.932 billion pounds, down from August stocks of 3.046 billion, but above average of estimates at 2.873 billion pounds.

 

In overseas markets, 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.

 

Crude palm oil futures on Malaysia's derivatives exchange ended slightly lower Thursday despite a rise in exports and projected drawdown in stocks, after speculation that an Indian province may ban palm oil imports, market participants said. The benchmark January CPO contract on Bursa Malaysia Derivatives ended MYR6 lower at MYR2,713 a metric tonne.