August 12, 2008

 

CBOT Soy Review on Monday: End higher; consolidates ahead of USDA report

 

 

Chicago Board of Trade soybean futures ended higher Monday, scoring a consolidative bounce following prior losses as traders squared positions ahead of Tuesday's crop report.

 

August soybeans settled 16 cents higher at US$12.15, and November soybeans ended 15 1/2 cents higher at US$11.96.

 

December soymeal settled US$7.20 higher at US$320.50 per short tonne. December soyoil finished 5 points lower at 51.45 cents per pound.

 

Speculative short-covering was featured in otherwise subdued trading, with traders unwilling to take on added risk heading into a crop report with the uncertainties of yield, acreage, output and demand lying in the balance, analysts said.

 

Futures managed to divorce themselves from the negative influence of outside markets, as the market seemingly is shifting its focus back to fundamentals, and a still tight projected stock situation, analysts added.

 

Active contracts traded inside days on technical charts, signaling a sideways consolidative theme, as traders take a cautious approach after futures tumbled over US$4.00 a bushel from there July high to Monday's settlement, a CBOT floor broker said.

 

Heading into a report even is the second best seat in the house, he added.

 

In pit trades, speculative fund buying was estimated at 2,000 lots.

 

Meanwhile, weather remains non-threatening for U.S. Midwest soybean crops and that continues to provide overhead price resistance.

 

Looking ahead, USDA is scheduled to release its August crop report Tuesday 8:30 a.m. EDT (1230 GMT). The average of analysts estimates projects a crop size of 3.003 billion bushels with a yield of 41.6 bushels per acre. The averages ranged from 2.957 billion to 3.100 billion bushels for production and 40.7 to 42.5 for yields. The USDA currently pegs the crop at 3.000 billion bushels using a trend-line yield of 41.6 bushels an acre.

 

The August report is the first 2008 crop estimate based on field surveys.

 

USDA will release is weekly crop progress report at 4:00 p.m. EDT Monday.

 

 

SOY PRODUCTS

 

Soy product futures ended mixed, with soymeal bouncing in unison with soybeans. Soyoil futures ended narrowly mixed, caught in between support from soybeans and pressure from weaker crude oil futures.

 

December oil share ended at 44.53% and the November/December crush ended at 75 cents.

 

Speculative fund buying was estimated at 2,000 lots in Soymeal and 1,000 lots in soyoil.