CBOT Soy Review on Monday: Stumbles on outside market factors

 

 

November soybeans ended 23 cents lower at US$11.79. 

 

December soymeal settled US$1.30 higher at US$335.80 a short tonne. December soyoil finished 143 points lower at 46.56 cents a pound. 

 

Outside market pressures set the stage for the declines, with crude oil's plunge below US$100 a barrel, a bounce in the U.S. dollar and the bearish impact of U.S. economic woes providing market jitters to send buyers running for cover, said Brian Hoops, president Midwest Market Solutions. 

 

However, futures did find strength from weekend floods that could delay the harvest of already late maturing crops in parts of the Midwest and carryover support from Friday's crop reports revealing smaller yields, analysts said. 

 

Long liquidation was featured, but two-sided action briefly emerged on end-user buying. A smaller-than-expected crush figure that may add bushels to the 2007-08 carryout and sluggish export demand served as defensive influences. Futures failed to find enough buying to break out of the shadows of bearish macroeconomic forces and subsequently ended in negative territory, analysts added. 

 

Meanwhile, despite weekend floods, some traders downplayed the potential of heavy crop losses, citing favorable weather forecasts that will dry out fields in the next week. 

 

The DTN Meteorlogix Weather forecast said the next week to 10 days offer a much more favorable weather pattern for central U.S. row crops. Rainfall forecasts have almost no precipitation for the Corn Belt this week. This drier weather will allow some drying of fields and help crops to move along in their ripening stage. Temperatures will be somewhat cool in the Midwest, but warm with 10-degrees-above-normal Fahrenheit readings in the northern Midwest through northern Plains. Some of that warmth will spread into the Midwest by late in the week, Meteorlogix added. 

 

The U.S. Department of Agriculture is scheduled to release its weekly crop progress report at 4 p.m. EDT, and analysts anticipate a steady-to-two-percentage-point decline in crop ratings. 

 

In pit trades, speculative fund-selling is estimated at 2,000 lots. 

 

 

Soy product futures ended mixed, with soyoil futures tumbling on speculative long liquidation on spillover weakness from crude oil futures. The energy component of soyoil-biodiesel continues to keep the market following crude oil, analyst said. Soymeal futures ended higher, bouncing on meal/oil spreads amid weakness in soyoil, traders add. 

 

The December oil share ended at 40.94% and the November/December crush ended at 72 cents. 

 

Speculative fund-buying was estimated at 1,000 lots in soymeal. Spec selling was estimated at 2,000 lots in soyoil, with commercial buying estimated at 1,500 lots.