Market Recap: Soybean Futures (Source: CME)
Chalk it up as another highly volatile day of price action in the soybean market, as early morning losses were met with buying interest and futures ended mixed. July through September beans closed 1 1/2 to 9 cents higher, with the rest of the market down mostly around 2 cents. Meal also closed higher, while soyoil ended weaker on spillover from sharp losses in crude oil.
Soybean Complex Market Recap (Source: CME)
July Soybeans finished up 9 at 1422, 1 off the high and 35 3/4 up from the low. November Soybeans closed down 2 3/4 at 1302 1/4. This was 20 up from the low and 7 3/4 off the high. July Soymeal closed up 7.8 at 425.0. This was 15.6 up from the low and 0.3 off the high. July Soybean Oil finished down 1.04 at 50.43, 1.09 off the high and 0.38 up from the low. July soybeans opened 10 cents lower on the day session and closed 9 cents higher on the day. A surge higher in wheat and strong gains in old crop corn helped turn the market from negative to positive. The market pushed lower early due to the sharp break in the China stock market and fears of continued economic issues in the eurozone due to Greek politics and this sparked a continued long liquidation selling trend early. However, a turn more positive in outside market forces plus a strong rally in the other grains helped to support higher trade on the day. Bull spreads were also active and November soybeans rallied 20 cents from the overnight lows but still closed slightly lower on the day. The surge in meal helped to pressure the soybean oil market and the sharp break of 3.9% in Malaysia palm oil added to the bearish tone early. The China National Grains and Oils Information Centre sees China soybean production down 7% this year to 13 million tonnes. The group sees 2011/12 imports of soybeans near 58 million tonnes as compared with the USDA estimate of 56 million tonnes. New crop exports are pegged at 60 million vs. USDA at 61 mmt. For the weekly export sales report, traders see sales near 1.2 million tonnes as compared with 1.827 million last week.
Malaysian Palm-Oil Refiners Urge Tax Overhaul as Indonesia Gains (Source: Bloomberg)
Malaysia, the world’s second-largest palm-oil producer, needs to reform the industry’s tax structure to counter new rates in Indonesia that improved the competitiveness of refiners there, according to a trade group. Without changes to create a so-called level playing field, there will be “a slow death of the refining industry when the independent refiners move away,” said Mohammad Jaaffar Ahmad, chief executive of the Palm Oil Refiners Association of Malaysia. The tax changes by Indonesia last year made local crude palm oil, or CPO, cheaper than in Malaysia, cutting costs for refiners, according to Jaaffar. Southeast Asia’s largest economy is seeking to boost the value of commodity shipments, including metals, to raise investment flows and spur economic growth. Bernard Dompok, Malaysia’s plantation industries and commodities minister, said that changes are being drawn up.
“The problem is that the refiners are feeling the pinch of the tax changes in Indonesia and they want a level playing field,” Dompok told Bloomberg on May 11. “We will be proposing to the government a solution to the problem for the producers and the refiners,” he said, without giving details. Palm oil, the world’s most-consumed cooking oil, is used in everything from candy bars to biofuel. Malaysia and largest producer Indonesia account for about 89 percent of global shipments. Crude palm oil, which has more than doubled in the past decade, traded at 3,095 ringgit ($993) a metric ton on the Malaysia Derivatives Exchange at 5:56 p.m. yesterday.
Red-hot soymeal due for a slip?
--Gavin Maguire is a Reuters market analyst. The views expressed are his own. To get his real-time views on the market, please join the Global Ags Forum--
CHICAGO, May 15 (Reuters) - Corn and soybeans may have grabbed more headlines l ately (and attention), but soymeal has actually been the top performer of the agriculture arena so far in 2012, with prices recently up more than 30 percent since early January.
But the recent decline in speculator interest across the commodities arena as a whole leaves the meal market vulnerable to a steep price break, especially after soymeal speculative net length recently hit a record high just as end-user demand showed signs of softening.
VEGOILS-Palm hits new 3-mth low as Greek political crisis drags
SINGAPORE, May 16 (Reuters) - Malaysian palm oil futures tumbled to their lowest in more than three months , as traders feared a prolonged political crisis in Greece could slow the global growth momentum and dampen commodity demand.
"Palm is not spared from the broad-based selling as commodities including crude oil, gold, silver, soybeans and soybean oil are all dropping," said a trader with a foreign commodities brokerage in Malaysia.
Oil World cuts forecast of EU 2012 rapeseed crop
HAMBURG, May 15 (Reuters) - Hamburg-based oilseeds analysts Oil World said on Tuesday it has again cut its forecast of the European Union's 2012 rapeseed crop because of bad weather, this time by 0.1 million tonnes.
The EU crop will fall to a six-year low of 18.10 million tonnes from 19.12 million tonnes in 2011 after poor autumn sowing weather and a bitterly cold winter which damaged plants, Oil World said.
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