July 9, 2008

 

CBOT Soy Review on Tuesday: Prices slide again on weather, outside markets

 

 

Chicago Board of Trade soybean futures ended lower Tuesday, extending Monday's plunge on improved near-term crop outlooks and bearish outside market influences.

 

July soybeans settled 28 cents lower at US$15.61 and November soybeans ended 31 1/2 cents lower at US$15.29 1/2.

 

December soymeal settled US$9.20 lower at US$399.80 per short tonne. December soyoil finished 154 points lower at 64.96 cents per pound.

 

Follow-through selling from Monday's declines were featured for most of the day, as the market continued to extract premium from prices amid lack of a near-term weather threat and broad based commodity weakness, analysts said.

 

Weather forecasters continued to point to beneficial near-term crop conditions, with warm, rainy conditions expected to accelerate crop development, traders said.

 

Meanwhile, a firmer U.S. dollar coupled with weakness in crude oil and precious metal futures provided an outside push to keep prices firmly planted in negative territory.

 

Speculative selling was featured, but the market managed to trim earlier losses on talk of the market becoming oversold and the exhaustion of aggressive selling once futures neared recent lows, analysts added.

 

The DTN Meteorlogix weather forecast said Midwest crop areas continue to have a favorable outlook. An active weather pattern features more thunderstorms in the region Tuesday through Thursday. There is little risk to crops from hot weather. Any risk to crops appears to be higher from locally heavy storms and potential flooding than the risk from heat and dryness during reproductive growth stages, Meteorlogix said.

 

CBOT soybean and soymeal futures daily trading limits will revert back to their normal limits of 70 cents a bushel and US$20.00 per short tonne, respectively, Wednesday.

 

In pit trades, buyers and sellers were scattered among various commission houses, with speculative fund selling estimated at 5,000 lots.

 

 

SOY PRODUCTS

 

Soy product futures fell in unison with soybeans, as improved conditions for U.S. soy crops and outside influences combined to keep buyers on the run for most of the day. Follow-through speculative selling was a featured attraction, with broad based commodity selling weighing on futures throughout.

 

However, both products managed to trim their early losses, find underlying support as aggressive selling ran out of steam near session lows, analysts said.

 

December oil share ended at 44.82% and the November/December crush ended at 64 3/4 cents.

 

In soymeal trades, buyers and sellers were scattered among various commission houses, with speculative fund selling estimated at 3,000 lots.

 

In soyoil trades, buyers and sellers were scattered among various commission houses, with speculative fund selling estimated at 4,000 lots.

 

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