Soy Oil chart reading : correction range bound little downside biased.
Soybeans (Source: CME)
US soybean futures climb amid widespread buying of commodities. Spillover support from surging grain and crude oil prices lifted the market, traders say. Crop concerns added support, as wet weather delaying corn planting "could also trim soybean yield potential if delays continue," according to Doane Advisory Services. Soy is planted later in the spring than corn. CBOT July soybeans rise 38 1/2c to $13.79 1/2 a bushel.
Soybean Meal/Oil (Source: CME)
US soy product futures finish with strong gains amid broad buying of commodities. Soymeal and soyoil rally with soybeans, grains, crude oil and gold. The soy complex feels additional support from early concerns rains delaying corn planting may slow soybean planting if they continue. Forecasts for persistent wetness indicate "soy planting delays will be [the] next topical concern," according to brokerage firm RJ O'Brien. CBOT July soymeal bolts $10.60 higher to $361 per short ton, while July soyoil gains 1.26c to $57.30c per pound.
China Faces Soyoil Glut As Import From Argentina Looms (Source: CME)
A quick resumption of soyoil imports from Argentina may help bring down domestic prices in China, but this may further complicate the environment for the domestic soy crushing industry which is already reeling under the pressure of government price controls, record high soybean stocks and negative crushing margins. Argentina expects to resume soyoil shipments to China "soon" as well as start exporting meat and barley, stepping up trade ties at a time when the Chinese soy industry has signaled concerns that further edible-oil shipments would weigh on domestic prices. The South American nation, the world's largest soyoil exporter, is on a quest to mend its commercial relationship with the world's largest consumer, marred by disputes over protection. Argentine soyoil exports to China had virtually stopped during most of 2010 in what was seen as Chinese retaliation for anti-dumping action against its exports of manufactured goods.
"The soyoil shipments will start pretty soon... (and) we now have the green light for meat exports to China and also for barley," Argentine Undersecretary for International Trade Ariel Schale told Dow Jones Newswires Tuesday. He said discussions were underway to expand exports of corn, apples, pears, and bovine semen and embryo to China. Last Friday, Argentina won a deal to export at least 500,000 metric tons of soyoil to China, resuming a trade interrupted by accusations of Argentina's restrictions against Chinese manufactured goods. While the development removes an irritant in bilateral trade, it could create new problems in the Chinese market, industry participants said. In the wake of the soyoil deal, a Chinese state agricultural research agency noted this week that the domestic market was still swamped with soy stocks. Prospects of further Argentine shipments took soybean and soyoil futures on the Dalian Commodity Exchange down nearly 1% Tuesday.
Chinese imports of soybeans reached record levels last year, and have continued to stay robust this year as some importers use the trade as a source of short-term financing for other projects including construction. This has kept soybean imports high despite demand being lukewarm at best. Despite stock levels at China's ports at near-record levels in excess of 6 million tons, much of the country's soy crushing capacity is idling as price caps on cooking oils have eroded margins for soy crushers. The arrival of Argentinean soyoil is likely to make this worse, Nanhua Futures analyst He Lin said. "Right now, China's soyoil consumption level isn't rosy," the state-backed China National Grains & Oils Information Center said in a note Tuesday. Schale didn't provide a more specific timeframe for Argentine soyoil shipments to begin, but said the deal was struck after three Chinese companies visited Buenos Aires along with Commerce Minister Chen Deming last week to place the orders.
Chinese demand for corn, however, is projected to be higher, with private-sector analysts indicating earlier this year that the country's corn stocks-to-use ratio, an indicator comparing grain reserves with consumption levels, had fallen to around 37%, well below an average of 93% between 1993 and 2003. But China has been keen to portray an image of having sufficient domestic corn stocks, in part due to its need to maintain price stability.
Ruchi Soya sees India's 2010/11 edible oil imports down 9 pct
NEW DELHI, May 17 (Reuters) - India's edible oil imports could drop 9 percent in the year to October due to higher domestic oilseed output, the managing director of Ruchi Soya Industries , the country's top importer of cooking oils, said on Tuesday.
India, the world's biggest edible oil importer, bought 3.5 million tonnes of edible oils in the first half of 2010/11, down from 4.1 million tonnes in the year ago period.
Palm oil hits two-week high on stronger demand to come
KUALA LUMPUR, May 18 (Reuters) - Malaysian crude palm oil futures climbed to a two-week high as traders bet on strong demand in the weeks to come as top vegetable oil buyers India and China restock.
"Palm oil is not about to go down anytime soon. Demand in Asia is picking up and the crop scares in the U.S. And Europe will support prices," said a trader with a foreign commodities broker in the Malaysian capital.
Dry weather to cut EU 2011 rapeseed crop-Oil World
HAMBURG, May 17 (Reuters) - Dry weather may cut the European Union's 2011 rapeseed crop to a three-year low of 19.5 million tonnes from 20.59 million tonnes in 2010, Hamburg-based oilseeds analysts Oil World said on Tuesday.
"The deterioration of rapeseed production prospects is about to reach alarming proportions," Oil World said.
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