November 9, 2007

 

CBOT Soy Review on Thursday: Soybeans climb, despite volatile influences

 

 

Chicago Board of Trade soybean futures ended a two-sided session higher Thursday, following the volatile movements of crude oil amid the absence of fresh fundamental news.

 

November soybeans settled 4 1/4 cents higher at US$10.28 per bushel and January soybeans ended 2 3/4 cents higher at US$10.38 1/2. December soymeal settled US$3.50 lower at US$278.40 per short tonne. December soyoil finished 51 points higher at 44.15 cents per pound.

 

The influence of outside markets dominated futures once again, with weakness in the U.S. dollar and higher metal and crude oil futures for most of the day providing underlying support, analysts said.

 

However, a midday pull back in crude oil futures coupled with pre-crop report positioning applied pressure to pull prices into negative territory. The declines would prove to be short lived though, with strength in inflationary markets, underlying export demand, strength in soyoil and a lack of deliveries providing support to keep a floor under prices, analysts added.

 

The U.S. Department of Agriculture reported weekly soybean export sales were 614,500 metric tonnes for the week ended Nov. 1. Analysts had forecast sales between 400,000 and 600,000 metric tonnes. Soymeal sales were a net 211,300 tonnes, and soyoil commitments were 7,300 metric tonnes.

 

USDA also announced private exporters reported the sale of 120,000 metric tonnes of U.S. soybeans to China for delivery in the 2007-08 marketing year.

 

Meanwhile, USDA is scheduled Friday to release its final crop production report of the year based off conditions as of Nov. 1. The average of analysts' estimates from a Dow Jones Newswires survey peg U.S. soybean production at 2.606 billion bushels with a yield of 41.5 bushels an acre. The estimates are slightly above October USDA projections of 2.598 bushels with a yield of 41.4 bushels an acre. The average of estimates for the 2007-08 carryout is 213 million bushels, down slightly from the October USDA estimate of 215 million.

 

In pit trades, buyers and sellers were scattered among various commission houses with ADM Investor Services buying 300 January, and Rosenthal a buyer of 800 November.

 

 

SOY PRODUCTS

 

Soy product futures ended mixed, with soyoil charging to new contract highs as well as propelling to their highest levels in 33 years. Soyoil futures benefited from higher crude oil futures for most of the day, with strong demand for world vegoils serving as an underpinning feature as well, analysts said.

 

Soymeal futures ended lower, unable to recover from a midday sell-off on spillover from soybeans. A bullish spike to new highs in soyoil added pressure for soymeal on oil/meal spreads, analysts said. However, solid export demand remained a supportive feature to limit downside potential, analysts added.

 

December oil share ended at 44.20% and the November/December crush ended at 70 1/4 cents.

 

In soymeal trades, buyers and sellers were scattered among various commission houses, with speculative funds estimated sellers of 2,000 lots.

 

In soyoil trades, Bunge Chicago and Fimat each bought 300 December, JP Morgan and Rand Financial each bought 400 December. Sellers were lightly scattered among various commission houses. Speculative fund buying was estimated at 2,000 lots.