February 7, 2006

 

CBOT Soy Outlook on Tuesday: Up 1-2 cents on e-CBOT, wheat calls

 

 

Soybean futures at the Chicago Board of Trade were called to open 1-2 cents per bushel higher on Tuesday following firm overnight trade and firm opening calls for neighboring corn and wheat, brokers said.

 

"We're calling the soy complex to open better on a reversal from yesterday and following calls for a firm open in corn and wheat, but we're looking for a weak close on offshore prices," said Terry Reilly, a grain analyst at Citigroup.

 

In overnight screen trade, the e-cbot March soybean contract settled up 1 3/4 cents at $5.88 3/4 a bushel. March soymeal ended up 50 cents a short tonne at $181.50, and March soyoil closed up 0.08 cent at 22.65 cents a pound.

 

It will take a close in CBOT March soybeans above $6.00 to provide the bulls with fresh upside technical momentum, a technical trader said. A close below $5.75 would open the door to another leg down in prices.

 

First resistance for March soybeans was seen at $5.90 and then at $5.97 1/2--Monday's high. First support was seen at $5.83--Monday's low--and then at $5.77 1/2--last week's low.

 

U.S. Midwest cash soybean basis bids were mostly steady to weak Tuesday, cash dealers said. Spot cash soybean bids were down 2 cents in Cedar Rapids, Iowa; steady in Decatur, Indiana; and down 2 cents in Memphis, Tenn., they noted.

 

Improved weather in Argentina's soy growing areas was seen weighing on CBOT soy, brokers said.

 

Dry conditions or just a few light showers were forecast for Argentina's Cordoba, Santa Fe, and northern Buenos Aires Tuesday, while scattered showers and thunderstorms of .10-.50 inch were seen Wednesday.

 

Dry conditions or just a lingering light shower were expected Thursday, and dry conditions were forecast for Friday through Sunday, according to Meteorlogix weather service.

 

In Brazil, forecasts called for dry conditions or just light showers in Rio Grande do Sul and Parana for the next 7 days, according Meteorlogix weather service.

 

At China's Dalian Commodity Exchange, soybean futures settled lower on long liquidation, traders said.

 

The benchmark DCE May 2006 soybean contract settled RMB44 lower at RMB2,730 a metric tonne; the benchmark DCE May 2006 soymeal contract ended down RMB37 at RMB2,366/tonne; and the DCE September 2006 soyoil contract ended down RMB60 at RMB5,154/tonne.

 

In Malaysia, crude palm oil futures on the Bursa Malaysia Derivatives ended mixed Tuesday amid lackluster trading interest, brokers said. The benchmark April CPO contract ended at MYR1,449 a metric tonne, down MYR2 from Monday. Other contracts ended between MYR2 lower to MYR3 higher.

 

In Rotterdam, spot soybean and soymeal prices were lower, cash sources said.