April 9, 2007 

 

Monday: China soybean futures settle up; corn sharply higher

 

 

Soybean futures traded on the Dalian Commodity Exchange settled higher Monday, thanks to gains in soybean futures during electronic trading on the Chicago Board of Trade.

 

The benchmark September 2007 contract gained RMB18 to settle at RMB3,249 a metric tonne, after trading between RMB3,240 and RMB3,263/tonne.

 

Total trading volume fell to 207,250 lots from 215,444 lots Friday. One lot is equivalent to 10 tonnes.

 

"Soybean futures are likely to continue consolidating if there are no major weather issues to move the market," said Gao Yanrong, an analyst with Dalu Futures Co.

 

Meanwhile, traders said the gains in the session triggered some profit-taking.

 

Soymeal and soyoil futures settled mostly higher, along with the gains in soybean futures.

 

The benchmark September 2007 soymeal contract rose RMB18 to settle at RMB2,654/tonne.

 

The benchmark September 2007 soyoil contract settled RMB34 higher at RMB6,838/tonne.

 

Corn futures settled sharply up, as market talk about the release of corn export quotas and a government official's comment about relatively tight supply Monday drove prices higher, analysts said.

 

The benchmark September 2007 contract rose RMB20 or 1.2% to settle at RMB1,688/tonne, after trading between RMB1,672 and RMB1,700/tonne.

 

Open interest for the benchmark rose to 1,035,922 lots from 881,548 lots Friday.

 

"There was market talk around that the government had decided to release a 3 million tonne export quota to the major exporters," said a trader in Beijing.

 

Analysts said although the news hasn't been confirmed yet, market sentiment was boosted.

 

Also, comments by a government official about the domestic corn market added to the bullish sentiment.

 

"As demand growth accelerates, a basically balanced domestic corn market will possibly turn into a relatively tight-supply market," Chen Mengshan, an official with the Ministry of Agriculture, said at a press conference Monday.

 

Trading volume for all contracts rose to 840,948 lots from Friday's 221,466 lots.

 

"Corn is still in rangebound trade, with (technical) resistance for September at RMB1,730/tonne. We need to wait and see whether it can breach that," said the trader.