November 23, 2007

 

Friday: China soybean futures settle up; await clearer direction

 

 

Soybean futures traded on the Dalian Commodity Exchange extended gains to settle higher Friday amid a lack of clearer trading direction.

 

The benchmark September 2008 soybean contract settled RMB20 higher at 4,427 a metric tonne.

 

Total trading volume declined to 588,152 lots from 603,654 lots Thursday.

 

One lot is equivalent to 10 tonnes.

 

"There was a lack of market-moving news, and the market is likely to consolidate at current levels (before moving higher)," said Wang Xiaoguang, an analyst at Galaxy Futures.

 

Analysts expect high crude oil prices and the overall inflation environment to continue supporting agricultural product prices.

 

However, soft commodities futures have weakened recently, due to concerns of government policies to curb rising food prices, which were the main reason for an almost 11-year high inflation in October.

 

There were many rumors circulating in the market about the possibility of more soybean and soyoil imports, which would check rising prices.

 

Although the market digested this possibility, it will calm down and such declines are unlikely to occur again, said Dong Shuangwei, an analyst at Capital Futures in Beijing.

 

Palm oil futures settled mostly lower but soyoil futures settled mostly higher.

 

The benchmark May 2008 palm oil contract settled at RMB8,706/tonne, down RMB42/tonne from Thursday.

 

Total trading volume for all palm oil futures rose to 16,236 lots from 14,200 lots Thursday.

 

The benchmark May 2008 soyoil contract settled RMB36 higher at RMB9,388/tonne.

 

Soymeal futures settled higher.

 

The benchmark May 2008 soymeal contract settled RMB10 higher at RMB3,420/tonne.

 

Corn futures settled higher.

 

The benchmark May 2008 contract settled RMB22 higher at RMB1,787/tonne.

 

Total trading volume for all corn futures rose to 1,141,752 lots from 797,584 lots Thursday.