Monday: China soy futures rise on CBOT gains, confidence in growth

 

 

Soy futures rose on the Dalian Commodity Exchange Monday, tracking gains on the Chicago Board of Trade and amid confidence in the continuation of Chinese policies supporting macroeconomic growth.

 

The benchmark September 2010 soy contract settled RMB34 or 0.9% higher at RMB3,996 a metric tonne.

 

"The obvious reason is CBOT," said Gao Yanrong, research manager for Dalu Futures. "But there have also been less soy domestically, and the flow through the market is low, so we're seeing higher prices."

 

Farmers have been waiting on the sidelines, expecting prices to rise amid government crop purchases.

 

January prices are expected to come under pressure with higher import levels.

 

"But soy's outlook is being decided by a bullish outlook on macroeconomic conditions, not fundamentals," Gao said. "Even if soy's fundamentals aren't that great, macroeconomic policies are still supportive of growth, so the outlook is still pretty good."

 

Still, globally, soy appear unable to sustain an upside, weighed down by a bearish South American crop outlook.

 

Trading volume for all soy contracts rose to 316,532 lots from 187,128 lots Friday.

 

Open interest fell 4,230 lots to 355,240 lots.

 

Corn, palm oil, soyoil and soymeal futures also rose.

 

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      3,996        Up   34     316,532

Corn       Sep 2010      1,868        Up   14     129,524

Soymeal  Sep 2010      2,997        Up   23   1,250,478

Palm Oil  Sep 2010      6,978        Up   72     494,134

Soyoil     Sep 2010      7,810        Up   72     848,130