November 10, 2006

 

CBOT Soy Outlook on Friday: Beans flat-down 1 cent; e-CBOT, weak corn

 

 

Soybean futures on the Chicago Board of Trade are expected to open steady to 1 cent a bushel lower on a mixed overnight trade and calls for weaker corn and wheat, sources said Friday.

 

In e-CBOT trade, soybean futures were mixed. November beans fell 1 1/2 cents to US$6.56, while January rose 2 1/4 cents to US$6.71 3/4.

 

Late speculative-led selling Thursday pressured prices and soybeans closed with losses of 8 1/4-8 3/4 cents. This bearish action leads some to believe that follow-through sales could re-appear in the absence of bullish fundamental news and expected floor weakness.

 

"The trade was suspect the way we closed," said Don Roose, analyst and president of U.S. Commodities in West Des Moines, Iowa.

 

Price direction depends on whether traders decide to continue that liquidation ahead of the weekend, he added.

 

Weather conditions in South America are "non-threatening" and aren't expected to provide price support. Brazil will be mostly dry Friday through Sunday, though the long-range charts suggest a chance for rain late next week or next weekend, DTN Meteorlogix said.

 

Light showers were seen in northern Parana in the past 24 hours.

 

Mato Grosso and Mato Grosso do Sul saw scattered showers of 0.10-0.75 inch and local heavier amounts. Mostly dry conditions are expected there through next Tuesday, Meteorlogix said.

 

Soybean futures on China's Dalian Commodity Exchange fell, pressured by CBOT losses. The benchmark May contract closed RMB16 lower to settle at RMB2,826 a metric tonne.

 

Soybean supplies remain relatively strong as the new crop enters the market pressuring the futures. Traders, however, became more bearish on soybean prices this week as soaring imported beans prevented Chinese crushers from buying overseas, the China National Grains and Oils Information Center said Friday.

 

CBOT traders may also watch key outside markets for clues to speculative trading activity and price direction.

 

December crude oil futures are 59 cents lower at US$60.57 a barrel in electronic trade. The Reuters/Jefferies Commodity Research Bureau Index, a basket of commodity prices, is down 0.88 at 317.05.

 

December gold is US$2.80 lower at US$634.00 and the U.S. dollar is weak against the world's major currencies.

 

SOY PRODUCTS

 

Soy product markets are expected to open near steady, based on overnight dealings and steady to weak calls for beans.

 

In electronic trade, December soymeal was unchanged at US$198.30 a short tonne, while soyoil rose 12 points to 27.83 cents a pound.

 

Soymeal and soyoil futures on China's DCE closed mixed, with meal lower and oil higher.

 

Crude palm oil futures on the Bursa Malaysia Derivatives exchange closed lower in a minor technical correction, with the benchmark January contract down MYR12 at MYR1,675 a tonne.

 

Key export data came in mostly as expected, traders said. Cargo surveyor Intertek estimated Malaysia's palm oil exports from Nov. 1-10 at 487,580 tonnes, up 0.84% on the month, while SGS pegged palm oil exports at 451,440 tonnes for the same period.