December 15, 2006

 

Friday: China soybean futures settle lower; corn mostly up tad

 

 

Soybean futures traded on the Dalian Commodity Exchange settled lower Friday on long liquidation, continuing its consolidation amid weak fundamentals, analysts said.

 

The benchmark May 2007 contract fell RMB16 to settle at RMB2,835 a metric tonne, after trading between RMB2,827/tonne and RMB2,852/tonne.

 

Total trading volume fell to 62,858 lots from 93,112 lots Thursday.

 

One lot is equivalent to 10 tonnes.

 

"Soybean has been supported by strong corn prices lately, while falling soymeal cash prices are adding pressure to it," said Zhang Jun, an analyst at Jiuheng Futures Co.

 

However, "it's more likely to see downside in near term, as corn seems to capped at the current level," he said.

 

Analysts said given the weak soymeal prices at the moment and large amount of imports, China sees weaker fundamentals than the U.S., which means that DCE may not be able to follow CBOT gains closely in the near future.

 

Soymeal and soyoil futures settled lower, along with soybean futures losses.

 

The benchmark May 2007 soymeal contract fell RMB14 to settle at RMB2,312/tonne, after trading between RMB2,306/tonne and RMB2,327/tonne.

 

The benchmark May 2007 soyoil contract settled RMB84 lower at RMB6,643/tonne.

 

Dalian's corn futures settled mostly higher a tad.

 

The most active September 2007 contract gained RMB5 to settle at RMB1,701/tonne, after trading between RMB1,695/tonne and RMB1,709/tonne.

 

Trading volume for all corn contracts fell to 591,872 lots from 972,390 lots Thursday.

 

"Corn doesn't seem to be able to see new highs in a short time," after the government expressed its determination to control the agricultural commodities prices, said in a trader in Beijing.

 

"People agree that in the long term, it still looks bullish, but for short term, it looks like it's lacking the momentum to rise further," said the trader.