CBOT Soy Outlook:Seen Up On Pre-Report Position Evening

By Andrew Johnson Jr.
Of DOW JONES NEWSWIRES

CHICAGO (Dow Jones)--Soybean futures are seen starting Wednesday's day session on firm footing, underpinned by
pre-report positioning and supportive outside market influences.

Strength in overnight trade is serving as an early signal of price direction.

Overnight, Chicago Board of Trade soybean July soybeans were 4 cents higher at $9.35, and November soybeans were 1/2
cent higher at $8.94 3/4.

Soybean prices have been under pressure in recent weeks, and traders that bet on futures going lower have assumed risk
heading into Thursday's supply and demand report, a CBOT floor analyst said.

Market shorts are expected to cover some of their positions, taking protection from a possible bullish surprise in
Thursday's U.S. Department of Agriculture reports, he added.

The USDA's supply and demand report is scheduled for release Thursday at 8:30 a.m. EDT (1230 GMT). Analysts surveyed
by Dow Jones expect 2009-10 U.S. ending stocks, which represent the amount remaining after all supply and demand factors
have been taken into account, to come in at a modest decline from May's figure.

Weakness in the U.S. dollar, firmer crude oil and equities are providing psychological support to aid the firmer tone
as well. Meanwhile, old crop contracts continue to garner strength from tight availability of nearby supplies. The
absence of farmer selling is keeping cash basis levels firm, as end users bid up prices in an attempt to lure
inventories out of farmer hands.

A technical analyst said market bears have the near-term technical advantage as prices Tuesday saw what could be the
beginning of a bearish downside "breakout" from the recent sideways trading range.

First resistance for July soybeans is seen at this week's high of $9.39 and then at $9.50. First support is seen at
Tuesday's low of $9.26 and then at $9.20.

In demand news, USDA on Wednesday announced private export sales of 240,000 tons of soybeans for delivery to China in
the 2010-11 marketing year. USDA also announced private export sales of 40,000 tons of soyoil for delivery to China in
the 2009-10 marketing year.

Meanwhile in overseas markets, China's soybean futures traded on the Dalian Commodity Exchange settled lower
Wednesday, drawn down by the tumble on CBOT Tuesday. The benchmark January soybean contract settled CNY22, or 0.6%
lower, at CNY3,784 a metric ton.

Crude palm oil futures on Malaysia's derivatives exchange ended lower, but off lows Wednesday due to short covering
and fresh buying interest related to expectations that palm oil exports will rise in the first 10 days in June, trade
participants said. The benchmark August contract on the Bursa Malaysia Derivatives exchange ended down MYR14 at MYR2,418
a metric ton.

-By Andrew Johnson Jr.; Dow Jones Newswires; 312-347-4604; andrew.johnsonjr@dowjones.com

(END) Dow Jones Newswires
06-09-10 0925ET
Copyright (c) 2010 Dow Jones & Company, Inc.