July 28, 2008
Monday: China soybean futures settle up; weather provides support
Soybean futures traded on the Dalian Commodity Exchange settled higher Monday, tracking a rise on the Chicago Board of Trade Friday and on e-CBOT in Asian time.
The benchmark January 2009 soybean contract settled RMB74 higher at RMB4,633 a metric tonne after trading in a narrow range of RMB4,612-RMB4,658/tonne.
An outlook for dry weather and high temperatures in the southern U.S. crop areas of the Mississippi Delta and Southern Plains will stress the crops there, said analysts.
Soy and soy products futures needed to rebound after tumbling for nearly two weeks, and the negative weather conditions provided a good reason, Yu Haifeng, an analyst at Tianqi Futures, said in a note.
He expects the mild rebound to continue in the near term, with immediate resistance for the benchmark January soybean contract at RMB4,660/tonne.
Soyoil futures, soymeal futures and palm oil futures settled higher, but corn futures settled lower.
Soymeal futures led Monday's gains, as the market has fully factored in the supply pressure stemming from the conclusion of a strike by farmers in major soybean provider Argentina.
Some investors had expected the fall to lose momentum, and any favorable news for long position holders may help the rebound, said analysts.
They said the weather in major soybean producing areas of the U.S. is now the focus, but too much optimism should be avoided, as the possibility of bad weather is diminishing with the harvest season approaching.
Meanwhile, analysts said crude oil prices are likely to remain bearish in the near term after their recent fall, which may make it more difficult for prices of other commodities to rise sharply.
Monday's settlement prices in yuan a metric tonne and the volume for all contracts in lots (One lot is equivalent to 10 tonnes):
Contract Settlement Price Change Volume
Soybean Jan 2009 4,633 Up 74 606,624
Corn Jan 2009 1,881 Dn 6 327,250
Soymeal Jan 2009 3,787 Up 71 517,264
Palm Oil Sep 2008 9,234 Up 90 15,852
Soyoil Jan 2009 10,410 Up 100 182,088