Soybean falls on selling pressure

The weakness in international oil and oilseeds markets had a strong bearish impact on Indian soybean derivatives market. All the available contracts on NCDEX fell almost 2% from previous day on strong selling pressure.
Lack of active buying interest especially from crushers on limited meal export enquiries had a bearish impact on the market.
Spot markets were closed due to local holiday. Financial year ending has been prompting traders and crushers to stay away from active trade participation.
Global markets were also down yesterday on profit selling ahead of USDA prospective planting report scheduled for release on 31st March 2011.
However, towards end of the day, market recovered on short covering.
Outlook
The soybean futures are projected to trade on a positive note in early trade of Friday on short covering.
Traders and investors are likely to cover their short positions. Positive trend in international market is likely to render support to the Indian market.
Domestic spot markets are likely to re-open today after local holiday and may see limited trade activity. However, the sentiment is still looking weak because of falling crush margin.
International market—CBOT soy and BMD palm oil—are ended higher and presently trading on a positive note on emergence of buying interest. US traders are buying soybean futures on fear of lesser soybean acreage in the upcoming season.
A rally in price of other commodities like cotton is likely to attract farmers to divert their soy acreage to cotton. Shift in global demand from Latin America to US is also supporting the global market.
Wet condition in Brazil due to recent rainfall is hampering harvesting and transportation of the produce. Market participants are waiting for release of US prospective planting report scheduled for release on 31st March 2011.
This report throws light on farmers’ intention to plant different crops in US. Bullish weekly export sales data is also supporting the CBOT soy market. According to USDA, during March 11-17 period, soybean exports from US rose 80% W/W to 264,500 tons.