November 30, 2009

 

CBOT Soy Outlook on Monday: Up 6-8 cents on dollar, underlying demand

 

 

Chicago Board of Trade soybean futures are expected to start Monday's day session higher, following the overnight theme with a lower U.S. dollar and underlying demand-supportive features.

 

CBOT soybean futures are seen starting 6 cents to 8 cents higher. In overnight trade, January soybeans were 6 1/2 cents higher at US$10.59 1/2, and March soybeans were 6 1/2 cents higher at US$10.65 1/4.

 

Mixed signals from outside markets are not providing clear directive influences, but with a lower U.S. dollar, and strong demand fundamentals, sellers continue to take a cautious approach, analysts said.

 

The market is gearing up for an anticipated influx of new speculative money to enter the market to start December, and that is seen holding selling interest at bay, analysts added.

 

Otherwise, a quiet news front is seen promoting another choppy session, with traders taking a wait and see approach to potential fund activity. Meanwhile, favorable planting and early development weather for South American crops are expected to apply mild pressure to prices.

 

A technical analyst said first resistance for January soybeans is seen at Friday's high of US$10.56 3/4 and then at US$10.66 3/4. First support is seen at US$10.40 and then at US$10.30.

 

The DTN Meteorlogix weather forecast said mainly favorable conditions are on tap for soybeans from Brazil's Parana northward as periods of scattered showers continue and temperatures are not too hot. Rio Grande Do Sul is very wet due to heavy storms this month and needs drier weather to improve prospects for planting soybeans. Rio Grande Do Sul may see somewhat drier weather developing, but probably not until later this week.

 

In Argentina, the weather pattern looks drier during the next week to 10 days. Crops should benefit from adequate soil moisture and somewhat cooler conditions during this period. However, soil moisture will be diminishing, Meteorlogix added in the forecast.

 

December soyoil deliveries totaled 2,826 lots. The house account at Rosenthal stopped 1,067 lots while customer accounts at Rosenthal stopped 909 lots. The house account at Tenco stopped 411 lots. The last trade date assigned was Nov. 12.

 

The U.S. Department of Agriculture is scheduled to release its weekly export inspections report at 11 a.m. EST, and its weekly crop progress report at 4 p.m. EST.

 

In overseas markets, China's soybean futures traded on the Dalian Commodity Exchange settled sharply higher Monday, as new funds flowed into the market on the back of favorable government policies. The benchmark September 2010 soybean contract settled 2.4% higher at RMB4,030 a metric tonne.

 

Crude palm oil futures on Malaysia's derivatives exchange ended down Monday but off intraday lows as likely lower palm oil output offset selling pressure triggered by Dubai's debt crisis. The benchmark February contract on the Bursa Malaysia Derivatives exchange ended MYR10 lower at MYR2,472 a metric tonne.