In The News - 06/06/2005
Soybean
futures at the Chicago Board of Trade rose on Friday, rebounding from Thursday's
sell-off, amid uncertainty about how much rain will reach the eastern U.S.
Midwest this weekend, traders said.
"Everyone
is trying to second guess how much rain we're going to get," said one floor
broker.
Beans
were also supported by technical strength in the soymeal pit, traders said. Buy
stops were hit in soybeans when soymeal rallied, pushing the July soy contract
up more than 10 cents per bushel.
The
market closed 2-1/4 to 7-1/2 cents per bushel, with the biggest jump in the
new-crop months. July soybeans closed 6-3/4 cents higher at $6.75-1/4 per
bushel, while new-crop November was up 7-1/2 at $6.80.
Funds
bought about 4,000 contracts, with Fimat Futures and Man Financial each buying
about 1,000 July, traders said. Funds were also rolling long July positions into
the November contract while commercials took the other side.
Some
midday forecasts reduced the amount of expected rain in their weekend outlooks
for the dry areas of the eastern belt. The crop needed moisture, especially in
central Illinois, a key production region. That kept traders edgy before the
weekend.
But
the western Midwest continues to see beneficial rains, almost too much in the
north. Wet fields in South Dakota and southern Minnesota were slowing farmers
from getting in the last of their soybeans.
There
was a neutral reaction to the U.S. Agriculture Department's export sales data.
But the current rate of sales looks on course to meet or exceed USDA's current
2004/05 export projection, analysts said.
The
government said Friday last week's soy export sales reached 208,500 tonnes (old
and new crop), just over trade estimates for 75,000 to 200,000. China was among
the top buyers, buying and shipping 24,700 tonnes.
Traders
in Shanghai said on Friday a 10 percent rise in Chinese soybean imports in the
first five months of this year has outpaced feed demand, boosting stocks and
prompting some buyers to delay deliveries.
Midwest
cash soybean basis bids early Friday were steady to firm amid slow farmer
selling.
The
South American soybean contract closed 4 to 5-1/2 cents higher, with July
<BSN5> up 5-1/2 at $6.71 per bushel, more than a 4-cent discount to the
U.S. contract.
The
soymeal market hovered near 11-month highs amid another surge of technical
buying by commodity funds. July <SMN5> closed $4.30 per ton higher at
$215.20, while the back months were up $2.70 to $4.40.
The
strength in U.S. meal prices this week and softer Brazilian and Argentine values
raised the possibility of U.S. buyers importing South American meal, traders
said.
Soyoil
futures followed the strength in soybeans and meal, but eased off their highs
near the close. July <BON5> was up 0.02 at 22.95 cents per lb., with
deferreds up 0.06 to 0.16 cent.
The
weekly export sales tally was viewed market neutral for soymeal and neutral to
slightly bearish for soyoil.
USDA
said 54,700 tonnes of U.S. soymeal (old and new crop) were sold for export last
week, within trade estimates for 40,000 to 80,000 tonnes.
U.S.
soyoil export sales totaled 2,500 tonnes (old and new crop) last week, compared
with estimates for 2,000 to 6,000 tonnes.
Malaysian
palm oil futures closed mostly firm. Traders in Kuala Lumpur said palm trading
was slow as players waited for a fresh lead.
Soybean
volume was moderate estimated at 63,235 futures and 24,490 options. Estimated
soymeal trade was 33,069 futures and 2,552 options. In soyoil, an estimated
30,925 futures and 4,422 options.
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