December 23, 2008

Soybean futures traded on the Dalian Commodity Exchange settled higher Tuesday, tracking an overnight rise on the Chicago Board of Trade.

 

The benchmark May 2009 soybean contract settled RMB15 higher at RMB3,199 a metric tonne.

 

Trading was light ahead of the year-end holidays, while a state cotton purchase boosted sentiment in the commodities market somewhat, said analysts.

 

The government is buying another 1.5 million tonnes of cotton from the market in a third round of purchases to stabilize falling prices, after earlier purchasing 1.22 million tonnes.

 

Industry participants also expect the government to buy another 20 million tonnes of corn from major producing areas to support sluggish domestic prices.

 

The government is trying to lend support to the commodities market, and a bottom to prices is likely to form by the end of this year, said Dong Shuangwei, an analyst at Capital Futures.

 

But investors are still cautious, as the momentum for a rise is weak.

 

Low crude oil prices have added resistance to the rebound in the overall commodities market, said Tianqi Futures in a note.

 

Open interest for all soybean contracts fell 7,092 lots to 454,780 lots.

 

Trading volume declined to 608,624 lots from 941,714 lots Monday.

 

Corn futures settled higher, but soymeal futures, palm oil futures and soyoil futures all settled lower.

 

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

                                                        

Contract        Settlement       Price      Change      Volume

Soybean        May 2009        3,199      Up   15      608,624

Corn             May 2009        1,520       Up    9      426,710

Soymeal        May 2009       2,294        Dn   24     498,494

Palm Oil         May 2009       4,836        Dn   26      84,632

Soyoil            May 2009       5,904        Dn   52     349,260