Nov Soybeans close 19 ¾ cents lower ($9.82), Jan 20 ¼ cents lower ($9.91) and March 19 ¾ cents lower ($9.98 ½)
Dec Meal closes $4.3 lower ($311.4), Jan $4.0 lower ($313.6) and March $3.3 lower ($315.4)
Dec Bean Oil closes 100 pts lower ($34.31), Jan 100 pts lower ($34.57) and March 97 pts lower ($34.81)
Highlights of the USDA Soybean Production/Supply-Demand Report – US – soybean yield increases 1.1 bpa leading to production increase of 92 million bu. – crush lowered by 20 million bu. – exports increased 25 million bu. – carryout increases by 85 million bu. – World – projected carryout increased by 4.17 M T.
Weekly Export Sales – Soybeans – old crop vs. 1.700-2.000 M T. expected; new crop vs. 0-100 K T. expected – Soybean Meal – old crop vs. 150-350 K T. expected; new crop vs. none expected – Soybean Oil – old crop 10-40 K T. expected; new crop vs. none expected
The trade had already been thinking we would see a higher yield (+0.6 bpa) but not a 1.1 bpa higher. It was also thought that the USDA would hike demand (exports) in an effort to offset. Well the USDA did hike exports 25 million bu. but that was offset with a decrease in crush; down 20 million bu. So when supply goes up 92 million a
5 million bu. increase in demand doesn’t go very far. The cut in crush did lend some left-handed support to the meal market which in turn tempered some of the losses in soybeans. Bean oil got hammered from the meal/oil spreading despite the bean oil projected carryout declining by 75 million lbs.
Like corn most interior soybean basis locations continue with the recent steady to higher trend. Harvest has come and gone. Offers to sell cash soybean meal continue to be in the doldrums. Bean deliveries continue to fly around – Dreyfus took interest in 16 of them. Soybean spreads stay soft looking as do the meal spreads.
Given what the USDA had to say today the soybean and soybean meal markets should continue as trading range affairs. Any hopes of a sustained run higher have been dashed. Without problems in SA I have to think bean and meal prices will soften back down to the earlier fall lows. As of this writing it looks like bean oil can move back down towards the $33.50 level (Dec). Dec bean oil has a gap at the $33.75 level.
Jan Beans: $9.83 ($9.74) – $10.03 Dec Meal; $305.00 – $317.0 Dec Bn Oil: $33.75 – $34.75
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