NEW DELHI (Commoditiescontrol) -
International Market Recap
US soybean futures gained over 0.5 percent during the week ended November 16 on fund short covering after Trump’s comments that his administration may not have to impose further tariffs on China, the world’s biggest soybean buyer.
The most active soybean contract for January delivery Chicago Board of Trade (CBOT) rose 5.5 cents weekly, or 0.62 percent, to USD 8.9225 per bushel.
Soybean furures were on both sides of unchanged last week with January back testing the upper limit of a trading range that's developed over the last five months.
Fund short covering and hope that US-China trade relations improve offered support. Fundamentally, US December soybean stocks are expected to be record large due to a big crop and slow exports.
Outside of the United States, planting progress in Brazil has reached 80 percent complete, while Argentine seedings are behind normal due to excess spring rainfall.
US soybean futures ended higher on Friday after rebounding on President Donald Trump’s comments that his administration may not have to impose further tariffs on China, the world’s biggest soybean buyer.
Trump has imposed tariffs on USD 250 billion of Chinese imports to force concessions from Beijing on a list of demands that would change the terms of trade between the two countries (all figures USD). China has responded with import tariffs on US goods, including soybeans.
Trump’s comments triggered a bounce in a soy market that has been highly sensitive to news about US-China trade relations. US soybean shipments to China have dried up in recent months after Beijing raised tariffs as part of the trade dispute between the world’s two biggest economies.
An expected meeting between Trump and Chinese President Xi Jinping on the sidelines of a G20 summit in two weeks has raised hopes of a settlement.
Domestic Market Recap
Soybean traded mostly steady to firm at the benchmark Indore market during the week due to some improved offtake amid fall in arrivals and positive cues from futures.
Spot soybean was unchanged at Rs 3,150-3,250/100kg. However, soybean for plant delivery escalated by Rs 75 to Rs 3,425/100kg. Soymeal also moved higher by Rs 500 to Rs 27,500 per tonne. While, refined soy oil edged lower by Rs 10 to Rs 750/10kg due to tepid buying and adequate stocks in domestic markets.
Losses in crude palm oil prices also weighed on the soy oil prices. Prices of crude palm oil and soy oil typically move in tandem as they are used as substitutes for each other.
Meanwhile, the government has slashed the base import price of crude soy oil by USD 11 to USD 717 per tonne effective from November 15.
Soybean prices are expected to trade steady to firm in the coming weeks on expectations of fall in arrivals. However the concerning factor is an increasing price of domestic soymeal in the international market, which could restrict overseas demand.
Indian soymeal is around USD 50 per tonne costlier against Argentine origin and the gap has widened in recent days as prices in the international markets dropped more than here.
Further sluggish tone in soy oil is also an important factor need to be watched out.
At the National Commodity and Derivatives Exchange (NCDEX), the benchmark December futures moved higher by Rs 19 to Rs 3,298 per quintal as compared to Rs 3,379 per quintal on last Friday, November 9.
(By Commoditiescontrol Bureau)
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