Wednesday: China soy futures settle down; but upward trend unchanged

 

 

Soy futures traded on the Dalian Commodity Exchange settled lower Wednesday, consolidating due to lack of support from the Chicago Board of Trade overnight.

 

However, soy futures prices are likely to remain on an upward trend for the near term on technical cues and with support from government purchasing policies, analysts said.

 

The benchmark September 2010 soy contract settled RMB12 a metric tonne lower at RMB4,016/tonne.

 

The contract opened lower, and consolidated between RMB3,991 and RMB4,040/tonne during the session.

 

There wasn't significant selling from long position holders, but some new short sellers came into the market to push down prices, said Liu Xinghua, an analyst with Great Wall Futures Co.

 

Imported soy prices at Chinese ports are around RMB4,000/tonne. At that price, crushers near the ports can reap a profit of RMB150-RMB200/tonne.

 

However, if imported soy prices rise while soyoil and soymeal prices don't move up much, domestic soy can be more attractive, Liu said.

 

Trading volume of all soy contracts declined to 850,838 lots from 956,684 lots Tuesday.

 

Open interest rose 7,466 lots to 482,918 lots Wednesday.

 

Corn futures settled little changed and soymeal futures settled unchanged, while palm oil futures and soyoil futures settled higher.

 

Following are 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

Soy         Sep 2010      4,016        Dn      12      850,838

Corn       May 2010      1,786        Dn       1       72,362

Soymeal  Sep 2010      3,020        Unch           1,799,574

Palm Oil   Sep 2010      6,800        Up     64      335,818

Soyoil      Sep 2010      7,830        Up     36     1,017,642