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CBOT Soybeans rise on short-covering, China’s tariff waiver Offer

7 Dec 2019 7:56 am
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Mumbai (Commodities Control) - Chicago Board of Trade soybean futures rose for the fourth consecutive session on Friday, extending a rebound from recent losses.

The most-active soybean contract reached its highest price since Nov. 26. January and March contract of Soybeans settled 0.5% higher at $8.89 and $9.03/bushel, respectively. January soybeans finished with a double-digit gain on the week, helped by trade optimism and ongoing support from the vegetable oil market.

Traders said market was oversold after the contract neared a three-month low on Monday.

Optimism for a possible U.S.-China trade agreement helped support prices, traders said, after China said it would waive import tariffs for some American farm products.

Soybeans received all the support this week, from short covering and reports that China was going to allow further tariff-free imports of soybeans but early gains failed to hold again.

The Brazilian Real remains cheap vs. the dollar with Brazilian weather still in good shape, with Argentina more mixed.

Traders are monitoring trade talks because China, the world's biggest soybean importer, slashed purchases from the United States after imposing retaliatory tariffs on U.S. soy last year.

U.S soybeans exports slowed in the latest week. USDA data on Thursday showed net export sales to China in the week ended Nov.28 at 298,617 tonnes, the smallest purchase since mid-October.

However, there was a flash sale on Thursday of 245,000 tonnes of U.S. soybeans, with 120,000 of that for delivery in 2019-20, but the buyer was unknown.

On trade front, White House economic adviser Larry Kudlow said a Dec. 15 deadline is still in place to impose a new round of U.S. tariffs on Chinese goods, but President Donald Trump likes where trade talks with China are going.

Bean basis has moved to a more sideways trend short term with pockets of firmness showing up on the break.

Support for January contract is at $8.68/bushel and resistance is at $9.00/bushel.

(By Commoditiescontrol Bureau; +91-22-40015502)

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