December 6, 2005

 

Tuesday: China soybean futures settle sharply higher on CBOT

 

 

China's Dalian Commodity Exchange soybean futures settled sharply higher Tuesday on fresh speculative buying, thanks to an overnight rise in Chicago Board of Trade soybeans.

 

The benchmark May 2006 soybean contract rose RMB34 to settle at RMB2,576 a metric tonne, after trading between RMB2,561 and RMB2,584/tonne.

 

Total trading volume for soybean futures increased to 305,582 lots from 174,800 lots Monday. One lot is equivalent to 10 tonnes.

 

Analysts said speculators pushed up the local market after they saw the overnight gains in CBOT soybeans, which were triggered by short covering.

 

Domestic players' confidence in the local market also recovered slightly, as China hasn't reported any bird flu outbreaks since last Thursday. Prior to this, it had frequently reported outbreaks of the disease since late October.

 

But some analysts cautioned that the technical bearish trend in the local market isn't likely to change, even if more rebounds occur in the near term.

 

"It takes time and effort to fully control the disease (bird flu)," said a Beijing-based analyst.

 

Dalian's No. 2 soybean contracts, which are encouraged to be delivered with soybeans harvested from genetically modified crops but are seldom traded, settled mostly higher.

 

The No. 2 May 2006 soybean contract settled RMB23 higher at RMB2,536/tonne, after trading between RMB2,528 and RMB2,543/tonne.

 

Soymeal futures traded on the exchange also settled higher, on moderate speculative long buying.

 

The benchmark May 2006 soymeal contract gained RMB25 to settle at RMB2,187/tonne after trading between RMB2,175 and RMB2,194/tonne.

 

Corn futures traded on the exchange settled mostly higher, extending recent gains amid talk of a likely pickup in Chinese corn exports.

 

The most heavily traded September 2006 contract settled RMB10 higher at RMB1,311/tonne, after trading between RMB1,307 and RMB1,317/tonne.