The Chicago Board of Trade soyabean market fell to a nine-month low on Wednesday on technical selling sparked by the weakness in soya oil and soyameal, traders said.
The soya complex reacted to bigger-than-expected October US soyaoil and soyameal stocks reported by the US Census Bureau on Wednesday. However, the soya crush came in within expectations.
"We got the confirmation of big oil yields and that's really the feature," said one-cash connected trader. The CBOT agricultural markets closed 45 minutes at noon CST ahead of the US Thanksgiving holiday. They remain closed on Thursday and reopen with the electronic session on Thursday night. January soyabeans closed 10-1/4 cents lower at $5.62 per bushel.
The deferreds were 6 to 11-1/4 cents weaker. New lows were made in September 2006 and January 2007. Sell-stops were triggered below $5.68-1/2 in January.
December soyaoil settled 0.35 per lb weaker at 21.63 cents, with the back months 0.15 to 0.43 cent down. December fell through a key support level of 21.85 cents, casting a bearish technical signal, traders said. December soyameal closed $2.90 per ton lower at $170.70, with deferreds $1.30 to $3.10 weaker.
Funds sold roughly 4,000 soyabean lots, 4,000 soyaoil and 2,500-3,000 soyameal, traders said. Near the close, Reface sold 1,000 March soyabeans and Iowa Grain sold 1,100 January meal.
Volume was light in soyabeans and moderate to heavy in the soya products. In soyabeans, an estimated 54,575 futures and 17,412 options traded.
Soyameal volume was pegged at 32,921 futures and 1,459 options. Estimated soyaoil trade was 29,120 futures and 2,226 options. The US Census Bureau reported the US October soyabean crush at 158.22 million bushels, compared to estimates for 158.0 million to 159.0 million and the October 2004 crush of 155.3 million.
The bureau reported US October soyameal/wholemeal stocks at 316,137 tons well above estimates for 212,000 to 281,000 and up from September stocks of 171,796 tons.
US October soyaoil stocks were at 1.864 billion lbs. versus estimates for 1.812-1.825 billion and the year-ago total of 1.255 billion. The oil yield was 11.59 lbs. per bushel, versus 11.32 lbs. a year ago and USDA's current 2005/06 estimate of 11.3 lbs.
"If that holds, it would mean 500 million lbs. more soyaoil than what USDA is currently estimating," said Vice Lesbians, floor broker with A.G. Edwards.
The market sank on Wednesday despite the seasonal tendency for January soyabeans to close higher the day before Thanksgiving, traders said.
Traders have turned their attention to South American weather as farmers were in the midst of planting soyabeans.
Recent rains in northern Brazil and Argentina have improved crop conditions, which added to the day's bearish sentiment, traders said. Midwest spot basis bids were firmer in the eastern belt and steady in the west, underpinned by light country sales, traders said.
Malaysian palm oil futures closed higher overnight to halt a two-day slide, taking cues from a rebound in US soyaoil. Overnight export news featured the Korea Feed Association issuing a tender to buy 185,000 tonnes of Indian, US and/or South American soyameal for feed production, traders in Seoul said.
Also, Asian traders reported that China bought several cargoes of South American soyaoil in the past week, with its domestic prices rebounding as bird flu is forcing many crushing plants to wind down operation.
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