Thursday: China soy futures settle down, tracking fall on CBOT

 

 

Soy futures traded on the Dalian Commodity Exchange settled lower Thursday, tracking an overnight fall on the Chicago Board of Trade.

 

The benchmark September 2010 soy contract settled RMB30 a metric tonne lower at RMB3,653/tonne.

 

A recovering U.S. dollar, improved weather outlook in the U.S. and big fall in local equities gave traders good reasons to sell, said analysts.

 

The coming launch of China's new Nasdaq-style board and a draft rule requiring banks to standardize the process of offering personal loans fueled concerns over liquidity, leading China shares to end sharply lower Thursday.

 

Rabobank said in its research note issued Thursday that global soy forward prices are likely to be bearish over the next 12 months due to record-high output in the 2009-10 crop year but added there's potential for further upside in prices in the near term.

 

According to the U.S. Department of Agriculture's Oct. 9 report, U.S. soy yield is forecast to reach 42.4 bushels per acre and result in a crop of 3.25 billion bushels.

 

But a delayed harvest together with earlier frost and recent wet weather may result in final yields falling short of estimations, said Rabobank.

 

Meanwhile, the dollar index is unlikely to stay above 80 effectively despite its current rebound, helping to support commodities, while the CBOT benchmark soy contracts are strongly supported at $8.50-$9 per bushel technically, said a local analyst.

 

Trading volume for all soy contracts declined to 105,066 lots from 162,938 lots Wednesday.

 

Open interest fell 2,640 lots to 266,392 lots.

 

Corn futures settled higher, while soymeal futures, palm oil futures and soyoil futures all settled lower.

 

Thursday's settlement prices in yuan a metric tonne for benchmark contracts and volume for all contracts in lots (One lot is equivalent to 10 tonnes):

 

               Contract     Settlement Price  Change     Volume

Soy        Sep 2010      3,653        Dn      30        105,066

Corn       May 2010      1,737       Up        3         98,312

Soymeal  May 2010      2,800       Dn      20       1,243,572

Palm Oil  May 2010      6,026        Dn    104       183,598

Soyoil     May 2010      7,164        Dn    100       644,110