December 24, 2007
Monday: China soybean futures settle mostly up despite tax extension
Soybean futures traded on the Dalian Commodity Exchange settled mostly higher Monday, tracking a rally on the Chicago Board of Trade Friday.
The benchmark September 2008 soybean contract settled RMB40 higher at 4,509 a metric tonne.
One lot is equivalent to 10 tonnes.
"The overall inflation will continue, as the new loans in the new year will push food prices higher," said Gu Jianjun, a trader at Jinyuan Futures.
Domestic demand for edible oil will likely remain strong, and the government's efforts to rein in rising prices may be in vain, traders said.
China will extend its reduction of the soybean import tariff to 1% to March 31, People's Daily reported on the Web site of its overseas edition Monday, quoting Finance Minister Xie Xuren.
Xie said the move is aimed at guaranteeing domestic supply of edible oil.
China cut the soybean import tariff to 1% from 3% for the October-December period to keep volatile domestic prices in check.
Soybean futures fell slightly on the news, which will help reduce import costs, but analysts said the impact could be brief as expectations for increasing soybean demand will likely push CBOT prices higher.
China imported 3.35 million tonnes of soybeans in November, up 43% on year, the General Administration of Customs said Monday.
The country imported 27.89 million tonnes of soybeans during the first 11 months, up 7.9%, it said.
Palm oil futures, soyoil futures and soymeal futures settled higher, while corn futures settled mostly lower.
Monday's settlement prices in yuan a metric tonne and volume for all contracts in lots:
Contract Settlement Price Change Volume
Soybean Sep 2008 4,509 Up 40 519,208
Corn May 2008 1,722 Dn 2 618,252
Soymeal Sep 2008 3,336 Up 46 1,251,588
Palm Oil May 2008 8,942 Up 176 19,056
Soyoil May 2008 9,898 Up 106 145,100
