March 12, 2009
Thursday: China soy futures settle up; but soyoil weighs on market
China's soybean futures traded on the Dalian Commodity Exchange settled higher Thursday, supported by favorable U.S. Department of Agriculture report overnight.
The benchmark September 2009 soybean contract settled RMB15 a metric tonne, or 0.4%, higher at RMB3,445/tonne, after trading between RMB3,409-3,463/tonne during the session.
The U.S. Department of Agriculture pegged U.S. soybean ending stocks at 185 million bushels, down 25 million bushels from its estimate in February, and below the average analyst estimate of 200 million bushels.
However, the weakness in soyoil prices due to bearish inventory data, and lack of support from the outside markets such as equities and crude oil, helped curb the rise in soybeans, said Tianqi Futures in a note.
Soyoil stocks are projected higher due to sharply reduced domestic use soyoil-based biodiesel production, the USDA reported.
But Tianqi Futures expected the benchmark soybean contract to be supported at RMB3,360/tonne, and pressured at RMB3,450/tonne in the near term.
Chinese farmers are likely to increase their acreage of oilseeds by almost 670,000 hectares this year as the government targets a higher degree of self-sufficiency and to limit soybean and grain import growth, a senior government official said Thursday.
But the country isn't against importing soybeans as imports help the country meet rising domestic demand, said Vice Agricultural Minister Wei Chaoan.
Trading volume of all soybean contracts declined to 317,982 lots from 381,506 lots Wednesday.
Open interest fell 8,578 lots to 351,796 lots Thursday.
Corn, soymeal, soyoil and palm oil futures all settled lower.
Thursday'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
Soybean Sep 2009 3,445 Up 15 317,982
Corn Sep 2009 1,681 Dn 9 114,860
Soymeal Sep 2009 2,508 Dn 7 543,038
Palm Oil Sep 2009 5,182 Dn 110 120,194
Soyoil Sep 2009 5,984 Dn 104 361,670
