November 26, 2008
China's soybean futures fell slightly Wednesday in thin trade on the Dalian Commodity Exchange, taking their cue from weaker crude oil amid a lack of fresh news to swing prices in a definitive direction.
The benchmark May 2009 soybean contract lost 0.7% to settle at RMB3,266 a metric tonne.
"Soybean isn't moving much, even on the Chicago Board of Trade," said Kang Zhichao, an analyst with Nanhua Futures in Hangzhou. "There isn't much news, except that oil is down again."
Corn futures settled down as well, but soymeal and vegetable oil futures posted gains.
Traders said a rally earlier this week was "overdone," and meanwhile weakness in the dollar, equities and crude oil nudged nearby Chicago Board of Trade soybean futures 1-2 cents lower Tuesday.
Crude oil is linked to soybeans because funds often trade in a basket of commodities and because soyoil is used to make biodiesel.
Reports that Ukraine, the world's fifth-largest exporter, recorded a surge in grain production pressured prices, a Bloomberg report said.
Huang Liqun, of Shanghai JC Intelligence, said Dalian had rallied late last week and earlier this week on news of government plans to raise corn and soybean stockpiles.
But the rally appeared to be burning out as the market awaited Beijing's next move, she said.
Spot prices in the major northeast producing regions were also headed lower, as large volumes of soybeans remain in farmers' hands. Some 90% of the harvest has been completed, Kang said.
"With prices of imports still much lower, soybean prices can't keep going up," Huang said.
Cash domestic soybean prices in Heilongjiang, a major producing province, have drifted slightly lower from a week ago.
Open interest in all soybean contracts fell 16,318 lots to 592,162 lots Wednesday.
Trading volume rose to 595,106 lots from 501,636 lots Tuesday.
Wednesday'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
Soybean May 2009 3,266 Dn 25 595,106
Corn May 2009 1,585 Dn 3 183,372
Soymeal May 2009 2,389 Up 2 455,288
Palm Oil May 2009 4,770 Up 110 113,664
Soyoil May 2009 6,102 Up 58 406,064