Tuesday: China soy futures settle up on CBOT; not much room to rise
Soy futures traded on the Dalian Commodity Exchange settled higher Tuesday following gains overnight on the Chicago Board of Trade, after coming off session highs.
The benchmark September 2010 soy contract settled RMB44 higher at RMB3,734 a metric tonne, or up 1.2%.
Expectations that the government will maintain a supportive purchase plan this year continued to support the market, analysts said.
Gains in equities and metals markets also helped to support agricultural prices.
However, there isn't much room for benchmark soy to rise above RMB3,750/tonne, which is expected to be the government's base purchase price, said Yu Ruiguang, an analyst with Tianqi Futures.
The Ministry of Commerce said in a recent analytical report that commodities prices will likely rise in the coming months, but gains probably won't be large due to the difficult recovery in the global economy, the end of earlier economic stimulus policies by various governments and the dollar's weakness.
"There (is unlikely to) be a fundamental change in U.S. dollar's weakening trend in the near to medium term, (so) commodities prices will remain at comparatively high levels," the ministry said.
Trading volume of all soy contracts rose to 356,912 lots from 220,574 lots Monday.
Open interest rose 4,226 lots to 279,532 lots Tuesday.
Corn futures, soymeal futures, palm oil futures and soyoil futures all settled higher.
Following are Tuesday'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 3,734 Up 44 356,912
Corn May 2010 1,740 Up 3 47,806
Soymeal May 2010 2,836 Up 28 1,030,326
Palm Oil May 2010 6,092 Up 60 143,076
Soyoil May 2010 7,260 Up 80 770,732
