December 31, 2009

 

CBOT Soy Outlook on Thursday: Up on weaker dollar, export sales

 

 

Chicago Board of Trade soybeans are expected to climb on Thursday's open on a weaker dollar and solid export demand amid thin trade.

 

Soybeans are called 7 cents to 9 cents higher. In overnight trade, January soybeans were up 7 cents to US$10.43 1/4 per bushel and March soybeans were up 8 cents to US$10.52 1/2.

 

January soyoil was up 66 points to 40.15 cents per pound and January soymeal was up US$0.50 to US$316.70 per short tonne.

 

The soft dollar is expected to give a boost to soybeans and commodities generally, analysts said. Trade is expected to be thin and price action choppy on the last day of 2009.

 

The market will be open its regular hours Thursday, closing at 2:15 p.m. EST. The market will be closed Friday for the New Year's Day holiday, and electronic trade will resume Sunday evening.

 

Analysts said that weekly export sales were solid. The U.S. Department of Agriculture reported weekly net sales Thursday of 1.075 million metric tonnes, including 799,000 for the 2009-10 marketing year. Analysts were expecting sales between 700,000 and 1.3 million tonnes.

 

Soymeal sales of 287,500 were at the high end of expectations, while soyoil sales were below expectations.

 

Soybean deliveries were higher than most expected. There were 1,020 deliveries against the January soybean contract on first notice day, with most expecting deliveries under 1,000.

 

Soyoil deliveries were "huge," an analyst said, at 9,263 deliveries against the January contract.

 

Technically, the market remains above the 20-day moving average crossing at US$10.38 1/2, a technical analyst said.

 

If March extends this week's rally, US$10.59 1/2 is the next upside target, The technical analyst said. Closes below the 10-day moving average crossing at US$10.27 would temper the near-term friendly outlook in the market.

 

First resistance is Wednesday's high at US$10.51 1/2, and second resistance is US$10.59 1/2, the technical analyst said. First support is at US$10.16. Second support is US$9.93.

 

In other news, the 2009-2010 soy crop is developing as expected, as rainfall improves soil moisture in drought-stricken fields. Excessive rainfall may delay late-season planting elsewhere, the Buenos Aires Cereals Exchange said.

 

The exchange is maintaining its soy-planting estimate at a record 19 million hectares this season.