In The News - 15/07/2005

Malaysian palm oil ended virtually flat on Thursday, surrendering early gains on the back of a strong soyoil, as the outlook for exports in July remained weak after a wobbly start.

Two shipping surveyors, Intertek Testing Services (ITS) and Societe Generale de Surveillance (SGS), will issue on Friday Malaysian export figures for the first half of this month versus June 1 to 15.

ITS and SGS have so far estimated a 27 percent drop in shipments for July 1 to 10 versus June 1 to 10. 

Dealers said on Thursday that market estimate for the first 15 days of July was about 25 percent lower than a month ago.

"Basically for ITS, people are talking about 485,000 tonnes, against 638,000 tonnes previously," said a trader. "That's no improvement if you ask me."

At Thursday's close, the benchmark third-month crude palm oil futures on Bursa Malaysia Derivatives, September <KPOU5>, ended 1 ringgit down at 1,419 ringgit ($373.42) a tonne. The high for the day was 1,426.

Other traded months were down 1 ringgit to up 2 <0#KPO:>.

Overall volume was just 2,565 lots of 25 tonnes. The market usually sees 6,000 lots or more on a busy day.

July soyoil <ZLN5> on the CBOT, or Chicago Board of Trade, rose 0.34 cent to 25.35 cents per lb at Wednesday's close.

CHICAGO, July 14 (Reuters) - Chicago Board of Trade soybean futures closed higher on Thursday after another volatile session, in which the market drew support from worries the U.S. soybean crop was shrinking due to hot, dry weather blanketing the Midwest, traders said.

Late in the session prices fell on some weather forecasts calling for rains to move into the Corn Belt as a result of Hurricane Emily.

"That triggered panic selling," one CBOT floor broker said.

As the market fell commercial buying surfaced, turning prices around before the close.

New-crop November soybeans <SX5> ended 6 cents higher at $7.31 per bushel after a roller-coaster session that saw a 33-cent trading range -- rising 26 cents, then falling 7 cents before recovering.

Front month August <SQ5> settled 6 higher at $7.20.

Commodity funds ended the day close to even, after buying the market early, traders said. Commercials were featured late buyers.

Meteorlogix weather service said a drier and hotter weather pattern was setting up in the western U.S. Midwest. The eastern Midwest should not be as hot, but temperatures will still range above normal after Saturday. Only minor shower activity was expected in the Midwest over the next week to 10 days, Meteorlogix said.

"Things are not looking very good for farmers, particularly in the central Illinois area and even increasingly concerning for the western Corn Belt," Meteorlogix forecaster Joel Burgio said.

Thursday was also the last trading day for July soybean, soyoil and soymeal futures. All three contracts expired quietly, with July soy <SN5> up 11-1/2 at $7.23.

The U.S. Agriculture Department's export sales and the National Oilseed Processors Association's June crush data released early Thursday were viewed as neutral to bearish.

USDA said U.S. export sales of soy last week totaled 175,100 tonnes (old and new crop combined), which was above expectations for 60,000 to 125,000 tonnes. But the amounts were 26 percent below the previous week and 28 percent under the four-week average.

China did book a small amount of soybeans, 2,800 tonnes, and shipped 58,800 tonnes.

Exports were also quiet overnight.

NOPA said U.S. processors crushed 125.257 million bushels of soybeans last month, below trade estimates for 128 million to 131 million bushels and the May crush of 136.7 million.

Deliveries on the July contract remained substantial at 650 lots. A commercial stopped roughly half the soy with the ADM house account taking 321 lots.

Registrations with the CBOT unchanged at 1,645 lots.

Midwest cash basis basis bids were mixed amid scattered sales, dealers said.

The soymeal and soyoil markets followed the moves in soybeans, coming off their highs late. August soymeal <SMQ5> closed $2.10 higher at $223.30 per ton, with the deferreds up $2.20 to down $1. August soyoil <BOQ5> was up 0.07 cent at 25.50 cents, while the back months were up 0.32 to down 0.10.

July soymeal <SMN5> went off the board up $8 at $230 per ton and July soyoil <BON5> expired 0.35 cent higher at 25.70.

USDA's export sales tally from last week was viewed as market neutral for soymeal and bearish for soyoil. There were 79,500 tonnes of old-crop U.S. soymeal sold for export last week, compared with estimates for 45,000 to 95,000 tonnes.

In soyoil, USDA reported no sales for last week. Traders had expected sales of 22,000 to 28,000 tonnes.

NOPA reported that June soymeal exports were 393,451 tons, up from 330,692 tons in May. The association also showed a drop in U.S. soyoil stocks during the past month. U.S. soyoil stocks in June were at 1.564 billion lbs., down from 1.571 billion in May.

There were no soymeal or soyoil July deliveries early Tuesday. CBOT soyproduct registrations were unchanged, with 170 meal registrations and 1,092 soyoil.

Malaysian palm oil futures closed narrowly mixed overnight. Traders in Kuala Lumpur said palm ended virtually flat, surrendering early gains on the back of strong soyoil, as the export outlook for July remained weak after a wobbly start.

Volume was moderate across the complex. In soybeans, an estimated 78,712 futures and 40,435 options traded. Estimated soymeal trade was 26,020 futures and 2,072 options. Soyoil trade was seen at 23,218 futures and 3,763 options.

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