November 5, 2007
Monday: China soybean futures settle up on CBOT; palm oil up on soyoil
Soybean futures traded on the Dalian Commodity Exchange settled mostly up Monday on higher Chicago Board of Trade prices Friday.
The benchmark May 2008 soybean contract settled RMB45 higher at 4,419 a metric tonne.
Total trading volume declined to 743,116 lots from 830,980 lots Friday.
One lot is equivalent to 10 tonnes.
Declining domestic soybean output, higher inflation concerns and excess liquidity in the financial market are factors which could push soybean prices higher towards the end of the year.
The benchmark May 2008 contract may consolidate at current levels before it can rise further to test the RMB5,000/tonne level, if its CBOT counter part sets a new record, said Wei Qiang, a branch manager at China International Futures Co. in Qingdao city.
Palm oil futures contracts settled higher on rising soyoil prices at CBOT.
The benchmark May 2008 palm oil contract settled at RMB8,598/tonne, up RMB58/tonne from Friday.
Total trading volume for all palm oil futures rose to 4,670 lots from 3,576 lots Friday.
Trading was light as traders aren't familiar with the new contracts and they aren't able to secure loans from banks due to the government's tightening monetary policies to curb high inflation, says Wang Lin, an analyst at COFCO Futures.
High inflation growth, at 6.2% in September, has forced the central bank to raise interest rates five times this year and lift the reserve requirement ratio for banks eight times.
Soymeal futures settled mixed and soyoil futures settled higher, along with palm oil futures.
The benchmark May 2008 soymeal contract settled RMB2 higher at RMB3,285/tonne, and the benchmark May 2008 soyoil contract settled RMB60 higher at RMB8,920/tonne.
Corn futures settled stronger as funds flow into the contracts.
The benchmark May 2008 contract settled RMB28 higher at RMB1,753/tonne.
Total trading volume for all corn futures rose to 1,178,764 lots from 1,044,898 lots Friday.