By Andrew Johnson Jr.
Of DOW JONES NEWSWIRES
CHICAGO (Dow Jones)–Soybean futures are expected to start Friday’s day
session on the defensive, with the market consolidating ahead of the weekend
after the week’s sharp gains.
Overnight, Chicago Board of Trade August soybeans were 1/4 cent lower at
$10.18 3/4 and November soybeans were 3/4 cent lower at $9.87 1/4. Analysts
expect soybeans to start 1 cent to 3 cents lower.
Less threatening weather forecasts for the central U.S. Friday morning than
previous outlooks are expected to take some edge off prices. The absence of a
fresh bullish spark may produce some profit-taking ahead of the weekend, as
traders reduce risk exposure with the threat of hot, dry weather not as
pronounced as forecasted Thursday, analysts said.
However, tight old crop inventories and strong demand remain underpinning
features to limit downside risks. Traders anticipate a choppy session, with
crop uncertainties and old crop fundamentals keeping a bid under the market,
while traders covering some positions ahead of the weekend keep a lid on gains.
The DTN Meteorlogix weather forecast said episodes of scattered
thunderstorms will maintain favorable growing conditions during the next five
days in the U.S. Midwest, despite some hotter weather. Longer range charts are
somewhat uncertain Friday due to differences between weather models.
Meteorlogix favors a continued wet pattern for the northern half of the western
Midwest region and the northern third of the eastern Midwest region with
hotter, drier weather to the south.
Meanwhile, China’s soybean imports in July are likely to reach 5.8 million
metric tons, the Ministry of Commerce said Friday. If realized, that would be
an 32% increase from the same period last year, based on customs data.