In The News - 14/11/2005
Malaysia's crude palm oil futures fell on Monday as players trimmed positions after a drop in soyoil prices and ahead of export data for the first half of November, dealers said.
The benchmark third-month January contract <KPOF6> on Bursa Malaysia Derivatives ended down 7 ringgit at 1,429 ringgit ($378.24) a tonne after trading as low as 1,425.
Overall volume was a light 2,186 lots of 25 tonnes each. The market can easily surpass 6,000 lots on a busy day.
"People are a bit nervous ahead of the export numbers, although we expect the drop in exports (from last month) to be smaller than in the first 10 days (of November)," said a trader.
Two cargo surveyors watched by the market -- Societe Generale de Surveillance (SGS) and Intertek Testing Services -- will release on Tuesday estimates of Malaysian palm oil shipments for the first 15 days of November.
SGS had estimated exports for Nov. 1-10 to have fallen 40 percent to 285,482 tonnes from the 473,891 tracked for Oct. 1-10. The drop was partly due to the Hindu Deepavali and Muslim Eid al-Fitr holidays.
Chicago Board of Trade soyoil futures for December <BOZ5> ended down 0.03 cent at 22.74 cents a lb on Friday, pressured by lingering concerns about big U.S. soyoil stocks.
Soybean futures on the Chicago Board of Trade slipped on Monday, setting back from Friday's rally and pressured by disappointing weekly export shipments, traders said.
January soybeans <SF6> closed 6-1/2 cents per bushel lower at $5.95, with the deferreds down 3 to 6-3/4 cents.
"The export inspections were pretty lousy. It indicates that we might have seen the peak in the weekly figure for the fall period, which would indicate that the pace of exports is pretty slow," said Anne Frick, an oilseed analyst with Prudential Securities.
The U.S. Agriculture Department said on Monday that 20.1 million bushels of soybeans were inspected for export last week, compared with trade estimates for 30 million to 35 million. More than half were ear marked for China, the world's top soy buyer.
Weakness in the soyoil pit contributed to the sell-off in soybeans. Oil was under pressure from U.S. oil stocks data released before the open.
The National Oilseed Processors Association soybean crush data came in within expectations, but the soyoil numbers were bearish as soyoil stocks grew amid record oil yields.
December soyoil <BOZ5> closed 0.23 cent per lb. weaker at 22.51 cents, with the deferreds down 0.15 to 0.25 cent.
NOPA reported U.S. processors crushed 150.859 million bushels of soybeans in October, compared with trade estimates for 148 million to 152.5 million.
U.S. soyoil stocks at the end of October were 1.495 billion lbs., versus 1.374 billion lbs. in September, NOPA said. U.S. soyoil yields were 11.65 lbs. per bushel during October, making it a record yield, analysts said.
"The
NOPA crush report actually was constructive from a demand point of view for
soybeans. But you have to remember that the swing factor in soybean usage is
really the exports and not the crush, because the changes in exports tend to be
much greater on a year-to-year basis than the change in crush," Frick said.
November soybeans <SX5> expired quietly at 12:01 p.m. CST, down 2-3/4 cents at $5.90-1/4. The November contract and November/January spread were underpinned early in the session amid firm U.S. cash soy markets, traders said.
Cash
basis levels remain supported by limited farmer sales, despite some weekend
movement after Friday's rally, and strong processor demand, dealers said.
There also was talk of fresh Chinese interest in U.S. soybeans for December, floor traders said.
That was underscored by large deliveries Monday morning of 514 contracts on the November, which were met by strong commercial stopping. The ADM house account put out 356 lots, but they were stopped by Term Commodities house account taking 269 and a customer of R.J. O'Brien stopping 245.
Traders have turned their attention to South American soy weather, now that U.S. soybean crop has been tucked away.
Argentina and Brazil were dry, or had just a few light showers, over the weekend.
Southern Brazil was expected to be mostly dry through Thursday, when it turns wetter, according to Meteorlogix weather service on Monday. Central Brazil should be dry until mid-week.
Northern Argentina was forecast to be dry until midweek. Soybeans in northern Argentina are in need of moisture for emergence and growth.
Soymeal futures closed lower on a technical setback after hitting a three-month high Friday. December <SMZ5> closed $1.50 per ton down at $180.20, with the back months 50 cents to $2.20 lower.
Malaysian palm oil futures closed weak overnight. Traders in Kuala Lumpur said palm sagged as players trimmed positions after a drop in soyoil prices and ahead of export data for the first half of November.
Weekly
trade data from the Commodity Futures Trading Commission was released late
Monday, one day late due to the Veterans Day holiday last week.
Commodity
funds sold 2,000 soybean contracts, 1,000 soyoil and bought 1,000 soymeal,
traders said.
Volume
was light in soybeans estimated at 47,383 futures and 18,599 options. Soymeal
trade was moderate pegged at 24,428 futures and 2,030 options. Estimated soyoil
volume was 21,298 futures and 2,409 options.
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