Soyabeans end lower on correction

The Chicago Board of Trade soyabean market tumbled on Friday as the forecast called for rain to move into the parched western US next week, traders said. Traders have been especially concerned about the western Midwest, where soyabeans need more rain after drought conditions intensified in the past week, according to the updated US Drought Monitor.
Changing weather forecasts have added to the week's volatility as soyabeans climbed to a near two-month high on Thursday amid jitters about dryness. That climb was a little overdone, adding to the bearish sentiment, traders said. July soyabeans closed 6-1/2 cents down at $6.02 per bushel weaker and new-crop November ended 7-1/2 down at $6.27-3/4.
Analytical firm Informal Economics estimated 2006 US soya production at 3.116 billion bushels, above the US Agriculture Department's June estimate of 3.080 billion, trade sources said. The firm pegged the average yield at 42.1 bushels per acre, up from USDA current estimate of 40.7, another bearish input.
The USDA reported export sales of US soyabeans for last week at 276,500 tonnes (old and new crop), within estimates for 200,000 to 400,000 tonnes. Spot Midwest basis bids for soyabeans were steady to firm late on Friday, underpinned by a lack of country sales, dealers said.
There were 968 deliveries posted against the July soyabean contract. The biggest stoppers were customers of Man Financial, at 322 lots, and Dowdy Weskit, at 337. The soyameal and soyaoil ended lower. Soyameal was under pressure from the weakness in soyabeans. Soyaoil saw a technical correction after making contract highs across the board on speculative buying due to strong technical signals.
Prospects for increased demand for soya biodiesel remains supportive. July soyameal ended $2.30 per ton weaker at $172.90, with deferreds $2.20 to $3.60 lowers. July soyaoil closed 0.02 cent down at 27.10 cents per lb, with deferreds through July 2007 down 0.10 to up 0.18.
Volume was on moderate in soyabeans and soyameal and heavy in soyaoil. In soyabeans, an estimated 84,355 futures and 21,692 options traded. Soyameal trade was pegged at 29,204 futures and 2,740 options. Estimated soyaoil was 38,958 futures and 6,159 options. Traders estimated that funds sold 2,000 soyabean futures, 2,000 soyameal and bought about 2,000 soyaoil contracts.
Weekly export sales data underpinned soyameal and was market neutral for soyaoil. USDA reported export sales of US soyameal for last week at 157,400 tonnes (old and new crop), above a range of trade estimates for 65,000 to 125,000 tonnes.