Monday: China soy futures settle sharply higher on fund inflows
China's soy 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 soy contract settled 2.4% higher at RMB4,030 a metric tonne.
The contract opened sharply higher, touching RMB4,066/tonne, the highest level so far this year, in intraday trading.
Agricultural products prices have been lagging behind other commodities, and the government's announcement of soy purchasing policy details gave funds a reason to buy in, said Nanhua Futures Co. analyst Huang Yinyan.
Last week, the government said it set the soy purchase price at RMB3,740/tonne for this year's new crop, higher than last year's RMB3,700/tonne. It will also provide subsidies for purchases by crushers.
Soy gains during Asian electronic trading at the Chicago Board Of Trade helped propel DCE counterparts higher, while the rise in other commodities along with rebounding equities markets also helped boost sentiment.
The Dubai debt repayment issue that plagued markets Friday has been largely digested, analysts said, and strong Chinese demand helped support soy prices.
The U.S. Department of Agriculture reported a marketing-year high of 2.43 million metric tonnes were shipped in the week ended Nov. 19, with China the primary destination for 1.84 million tonnes.
Trading volume of all soy contracts declined to 1,503,122 lots from 1,777,864 lots Friday.
Open interest rose 158,164 lots to 504,248 lots Monday.
Corn, soymeal, palm oil and soyoil futures all settled higher.
Following are Monday'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
Soy Sep 2010 4,030 Up 95 1,503,122
Corn May 2010 1,781 Up 9 131,924
Soymeal Sep 2010 2,997 Up 57 2,412,424
Palm Oil Sep 2010 6,728 Up 112 357,402
Soyoil Sep 2010 7,798 Up 112 1,076,820
