November 5, 2007

 

CBOT Soy Outlook on Monday: Down 3-5 cents, e-CBOT, outside market influences

 

 

Chicago Board of Trade soybean futures are seen starting Monday's day session on the defensive, taking their cue from overnight trade, as the influence of outside markets promote a lower theme, analysts said.

 

The U.S. dollar index is higher and crude oil futures are lower across the board.

 

CBOT soybean futures are called to start the session 3 to 5 cents lower.

 

In overnight e-CBOT trading, November soybeans were 5 cents lower at US$9.96 3/4 per bushel, and January soybeans were 5 3/4 cents lower at US$10.11.

 

"The dollar is stronger this morning, while crude oil is more than a dollar lower, leading to modestly lower oilseed prices in low trade volume overnight. As a result, the opening calls for grain and oilseed prices are lower, but they may firm a bit as the precious metals markets are trending higher," said Arlan Suderman, analyst with Farm Futures.

 

A quiet news front is keeping attention on outside markets, with an active harvest weekend and positioning ahead of Friday's crop reports expected to lend some pressure to aide the lower tone, analysts added.

 

Nevertheless, a technical analyst said market bulls still have a near-term technical advantage. The next upside price objective for January soybeans is to push and close prices above solid technical resistance at the contract high of US$10.33 1/2. The next downside price objective is closing prices below solid support at last week's low of US$9.94.

 

First resistance for January soybeans is seen at Friday's high of US$10.25 1/2 and then at US$10.23 1/2. First support is seen at Friday's low of US$10.08 1/2 and then at US$10.00.

 

November soybean deliveries totaled 122 lots. The house account at Term Commodities issued all 122 lots, with the house account at Rosenthal Collins LLC the primary stopper of 85 lots. The last trade date assigned was October 22.

 

Commodity Futures Trading Commission on Friday reported in its supplemental commitment of traders report that index funds held net long positions totaling 171,668 combined CBOT soybean futures and options contracts as of Oct. 30, up from 168,731 the prior week. Traditional large speculative traders were net long 115,632 contracts compared with net longs of 117,232 in the previous week. Commercials held net short combined futures and options positions totaling 250,152 contracts, up from the previous week's 245,508 contracts.

 

On tap for Monday, U.S. Department of Agriculture is scheduled to release its weekly export inspections report at 11:00 a.m. EST and weekly crop progress reports at 4:00 p.m. EST.

 

The DTN Meteorlogix Weather Service forecast said rainfall and soil moisture in Brazil favors early growth of soybeans in all areas with the exception of the western Bahia crop region.

 

In overseas markets, soybean futures traded on the Dalian Commodity Exchange settled mostly up Monday on higher CBOT prices Friday. The benchmark May 2008 soybean contract settled RMB45 higher at 4,419 a metric tonne.

 

Crude palm oil futures on Malaysia's derivatives exchange ended mostly higher Monday, amid lackluster range-bound trade, market participants said. The benchmark January CPO contract on Bursa Malaysia Derivatives ended MYR13 higher at MYR2,930 a metric tonne.