Soybean drops on global cues

NCDEX April soybean futures fell sharply in the morning hours due to weak overseas market. NCDEX April soybean prices bounced back after touching a low of Rs 2292/quintal, prices surged sharply higher in NCDEX in tandem with overseas market and touched a high of Rs 2345/quintal and finally mmanged to close at Rs 2317.50 a quintal with a gain of Rs 8 a quintal as compared to previous day’s close of Rs 2309.50 a quintal. There is news that Brazil crop may damage due to two weeks continuous heavy rains.

USDA’s Monthly supply & demand Report: The US Department of Agriculture today revised 2010-11 global soybean output estimate to 258.4 million tonnes, up by 2.3 million tonnes from its February estimate of 256.10 million tonnes. Brazil's soy crop output at a record 70.0 million tonnes n, up by 1.5 mln tn from the February estimate, due to timely rains in the producing regions of the country. It has raised output estimate for China as well. Argentina's soy output has been kept unchanged at 49.5 million tonnes. Estimate of soybean carryover stock in the US was also kept unchanged at 3.82 million tonnes. The USDA raised global 2010-11 oilseeds production estimate by 2.4 million tonnes from the February projection to 444.2 million tonnes. Oilseeds carryover stocks are now seen at 58.33 million tonnes, marginally up from 58.21 mln tn in February. Soymeal output is seen at 178.64 million tonnes, up 1.09 million tonnes from February estimate. Exports are also seen higher at 60.32 million tonnes from 59.46 million tonnes a month ago. The agency pegged soymeal year-ending stocks at 6.42 million tonnes.

Mustard Seed

NCDEX April RM Seed futures closed higher due to higher prices of other oilseeds and edible oils. NCDEX May contract, touched a high of Rs 2779 a quintal, however, it could not sustain higher levels, finally manged to close at Rs 2741 a quintal with a gain of Rs 10 a quintal as compared to previous day’s close of Rs 2731 a quintal. Higher production estimates of RM Seed this year as compared to last year and rising fresh arrivals in major mandis are in favour of the bears in the long term. Daily arrivals of RM seeds in Rajasthan were at 1 lakh bags and throughout India was around 1.50 lakh bags.

Refined Soy oil

NCDEX April Refined soy oil futures fell sharply in the morning hours due to sharp decline in BMD CPO futures. NCDEX April soybean oil prices bounced back after touching a low of Rs 598.70/10 kg, prices surged sharply higher in NCDEX in tandem with overseas market and touched a high of Rs 612.90/10 kg and finally mmanged to close at Rs 607.65/10 kg with a gain of Rs 1.15/10 kg as compared to previous day’s close of Rs 606.50/10 kg.

Malaysian Palm Oil Exports:

As per SGS (a cargo surveyor), exports of Malaysian palm oil during the March 1-15 fell 15 percent as compared to the same period in the last month to 520,463 tonnes.

Outlook:

Oilseeds complex are expected to trade slightly higher due to short covering after sharp fall in last 4-5 trading sessions. There is news that Brazil crop may damage due to two weeks continuous heavy rains may provide support to the bulls.