July 20, 2011

Tuesday: China soy futures decline on global economic woes

Soy futures on the Dalian Commodity Exchange (DCE) closed lower Tuesday (Jul 19), as concerns about the health of the global economy and weakness in domestic equities dampened investor sentiment.

The most actively traded May soy contract settled at RMB4,640 (US$718)/tonne, down 0.5%.

Wall Street and crude oil declined overnight amid ongoing concerns over government debt in the US and Europe.

"There are signs that DCE soy has begun a correction after a three-week rally, due to a lack of upward momentum on its CBOT counterparts," analysts said, adding that DCE soy usually underperforms CBOT markets due to oversupply.

China's July soy imports will likely rise 5% from a year ago to 5.2 million tonnes and remain flat at about 4.8 million tonnes in August, the state-backed China National Grain and Oils Information Centre said Tuesday.

Current port inventories were more than seven million tonnes, a record level and is equivalent to about 1.5 times China's monthly soy crushing amount, the CNGOIC said earlier.