Ref. Soyaoil on NCDEX settled up by 0.17% at 717.15 on late short covering after prices dropped amid expectation of higher supply in mandis. Moreover, higher production forecast in South America may have bearish impact on the domestic refined soyoil futures. However prices of oil may get support as stocks at various ports of the country were around 130,000 tons against 163,000 tons same period last year. With improving weather prospects in South America demand is slowing down in US. Latest weekly soy bean export sales fell to 87,700 tons (old-crop and new-crop combined) in the latest week from 979,200 tons a week ago. Government on December 30 trimmed tariff rates on soyoil to $892 per tons compared to $912 tons fixed on Dec 15. Before 2017 harvest, world bean-oil reserves will fall 10% to lowest since 2009, according to USDA. As per Argentina's agro industry ministry soyoil production was 8 million tons compared with 7.4 million tons in same period last year. As per the latest data shared by the Solvent Extractors’ Association of India (SEA), India’s overall kharif oilseeds production is projected at 178.25 lakh tonnes (lt) for 2016-17 against 126 lt last year. Edible oil production is estimated at 7.28 million tonnes (mt) for the oil year 2016-17 (November-October) against 5.80 mt last year. India's soymeal exports in 2016/17 are likely to jump to three-year highs as a sharp price correction due to a rebound in soybean production makes overseas sales competitive, said industry officials. At the Indore spot market in Madhya Pradesh, soyoil was steady at 729.75 rupees per 10 kgs. Technically now Ref. Soya oil is getting support at 715 and below same could see a test of 712 level, And resistance is now likely to be seen at 720, a move above could see prices testing 722.

Trading Ideas:

# Ref. Soya oil trading range for the day is 712-722.

# Ref soyoil gained on late short covering after prices dropped amid expectation of higher supply in mandis.

# Moreover, higher production forecast in South America may have bearish impact on the domestic refined soyoil prices.

# Stocks were at various ports of the country were around 130,000 tons against 163,000 tons same period last year.

# At the Indore spot market in Madhya Pradesh, soyoil was steady at 729.75 rupees per 10 kgs.