August 7, 2008


Thursday: China soybean futures settle lower, along with CBOT tumble



China's soybean futures traded on the Dalian Commodity Exchange settled mostly lower Thursday, along with declines on the Chicago Board of Trade overnight.


The benchmark January 2009 soybean contract settled RMB7 lower at RMB4,081/tonne, or down 0.2%, after trading in a range of RMB4,031-RMB4,138/tonne.


Open interest in various soybean contracts fell 18,506 lots to 469,836 lots Thursday.


The market has been consolidating since falling sharply in recent sessions, and sentiment has recovered somewhat for now, said Yu Haifeng, an analyst at Tianqi Futures.


He expects the benchmark contract to be strongly supported at RMB3,800/tonne.


Traders are likely to stay on the sidelines until the U.S. Department of Agriculture releases a supply and demand report Tuesday.


Analysts expect an increase in soybean unit yield estimates, as the negative effects of earlier floods in U.S.'s major soybean producing areas was overestimated, and weather has been mostly good since then, they said.


Soyoil futures, palm oil futures, soymeal futures and corn futures settled mostly lower.


Corn prices were lower on falling cash prices, as the government has been selling corn to stabilize prices.


Meanwhile, feedmeal demand is likely to remain sluggish until September, weighing on prices, Guangfa Futures said in a note.


Thursday's settlement prices in yuan a metric tonne and volume for all contracts in lots (one lot is equivalent to 10 tonnes):


Contract          Settlement          Price          Change          Volume

Soybean          Jan 2009            4,081          Dn   7          1,300,386

Corn                Jan 2009           1,779          Dn   4             239,492

Soymeal          Jan 2009           3,336          Dn  11            883,466

Palm Oil           Jan 2009           7,818          Dn  82              21,762

Soyoil              Jan 2009           9,014          Dn  32            445,630

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