July 1, 2011

Soy futures on the Dalian Commodity Exchange rose Thursday (Jun 30) for a third consecutive session, supported by a weaker dollar after the Greek parliament approved a five-year, EUR28-billion (US$40-billion) package of spending cuts and tax increases.

The benchmark January soy contract settled 0.1% higher at RMB4,428 (US$685)/tonne.

Trade volume was a low 71,644 lots, as traders stayed on the sidelines, awaiting clearer cues from an important USDA soy acreage report that is due Thursday. Market participants expect the USDA's estimate to be lower than its March estimate of 76.609 million acres.

Soy and edible oils are expected over the next few days to continue clawing back heavy losses sustained over the last three weeks, analysts said. But fundamentals are still too weak to provide long-term support, they said.

Recovering soymeal demand on the back of hog production expansion and sharply reduced domestic acreage would seem to support soymeal prices, but the upside is still limited, as pork prices may well peak in just a few months.