Soyabean futures at the Chicago Board of Trade were higher on Tuesday on a short-covering bounce after dipping to contract lows in all months except March on Monday, traders said. The market remains underpinned by firm cash markets as a lack of farmer sales this winter keeps the export pipeline tight. Processors are also scrambling for beans. That keeps March at a premium to the May contract, but the nearby was losing ground to May on Tuesday.

March soyabeans were 1-1/4 cent higher at $5.16 per bushel and May was up 3 cents at $5.15-1/2 by 11 am CST (1700 GMT).

The deferreds were 2-1/2 to 4 cents firmer.

Refco and Cargill Investor Services were among the featured buyers of March soyabeans, traders said.

The nine-day relative strength index for the May contract closed at 33 on Monday, just above the 30 level viewed as an oversold technical market.

Exports were quiet overnight. Ongoing sales of soyabeans to China, the world's top soyabean customer, continue to support prices, traders said. But the large supply of global oilseeds stocks and prospects for a big crop this year in South America are expected to keep pressure on the soyabean futures market.

The soyameal futures market was higher on a technical bounce from the recent price slide. March meal was up 70 cents at $154.50 per ton, with the March/May spread weakening amid a steady to weaker US cash market. Buying demand backed off, which pressured US basis offers, dealers said.

The deferreds were $1.20 to $2 per ton higher.

Soyaoil futures were firm, supported by the strength in soyabeans and soyameal, traders said. March soyaoil was up 0.02 cent at 19.38 cents per lb and deferreds were steady to 0.06 cent higher. But prices kept within its recent lower range as large global supplies of vegetable oil cast a bearish sentiment.

Copyright Reuters, 2005