November 13, 2006

 

CBOT Soy Outlook on Monday: Seen up 6-8 cents; e-CBOT, corn spillover

 

 

Soybean futures on the Chicago Board of Trade are called to start the week higher, following the overnight theme, with spillover strength from corn futures setting the stage for the firm start.

 

Soybean futures are called to open 6 to 8 cents higher.

 

In e-CBOT trade, November soybeans were 6 1/4 cents higher at US$6.57 1/2 and January was 8 1/2 cents higher at US$6.71 per bushel.

 

A quiet news front is expected to keep the market moving in tandem with corn futures, while technical features remain a key ingredient for price direction as well, analysts said.

 

Traders say recent declines provided enough consolidation and speculative buyers will likely re-emerge on corn price strength amid perceptions soybeans have to keep pace with corn to assure adequate acreage in 2007.

 

A technical analyst said Friday's close, near the session low and at the weekly low close, give market bears some fresh technical momentum heading into the new trading week. However, the market still has an overall near-term bullish technical advantage.

 

First resistance for January soybeans is seen at US$6.65 and then at Friday's high of US$6.71 1/2. First support is seen at Friday's low of US$6.60 and then at US$6.55.

 

In deliveries, a total of 1,509 delivery notices recirculated against the November soybean future. Issuers were widely scattered among various commission houses, with the house account at Term Commodities a featured stopper of 616 notices. The last trade date assigned was Nov. 10.

 

The DTN Meteorlogix weather forecast calls for rain to return to the southern crop belt of Brazil later this week, maintaining soil moisture for soybeans. There is some upper-level ridging in the area but it is not expected to last too long. In Argentina, it will be hot Monday and Tuesday before turning cooler. Rainfall during Wednesday into Thursday will help to maintain soil moisture for crops, Meteorlogix said.

 

On tap for Monday, the U.S. Department of Agriculture is scheduled to release its weekly export inspection 10 a.m. CST and crop progress reports at 3 p.m. CST. Commodity Futures Trading Commission will release its weekly commitment of traders report at 2:30 p.m. CST.

 

U.S. Midwest cash soybean basis bids are mostly unchanged Monday. Spot cash soybean bids were up 3 cents in Sioux City, Iowa, and up 3 cents in Quincy, Ill., according to cash sources Monday.

 

Rotterdam soybeans and soymeal were mixed. European vegoils were mixed.

 

In overseas markets, soybean futures traded on China's Dalian Commodity Exchange settled up Monday on spillover support from gains in corn futures, analysts said. The most-active May 2007 contract settled RMB17 higher at RMB2,843 a metric tonne after trading between RMB2,816/tonne and RMB2,856/tonne.

 

Crude palm oil futures on the Bursa Malaysia Derivatives ended higher Monday, boosted by speculative buying interest and gains in soyoil futures on a mostly choppy, uneventful trading day, traders said. The benchmark January CPO contract ended up MYR19 at MYR1,694 a metric tonne.