Jan soybeans close 16 cents higher ($10.43 ½) March 16 cents higher ($10.53 ¼) and July 15 ¼ cents higher ($10.64 ½)
Dec Meal closes $7.0 higher ($317.7), Jan $7.0 higher ($319.5) and March $6.9 higher ($322.5)
Dec Bean Oil closes 2 pts lower ($37.49), Jan 5 pts lower ($37.67) and March 5 pts lower ($37.94)
USDA announces 426 K T. soybeans sold to China
Weekly Soybean Export Inspections – 1.910 M T. vs. 1.500-1.900 M T. expected
The buying started Sunday night out of the Dalian Chinese soybean and soybean meal markets; spilled over into the US market. I still think a lot of our day-to-day trade is influenced by the Chinese speculator whether it is in China or here. The USDA announced export sale to China furthered the rally into the day session. Despite palm oil rallying to 4-year highs the bean oil market became the weak sister of the products as the meal market took over the day’s leadership role. Weekly export inspections came in at the high end of expectations which in turn furthered the rally. The weather in Brazil continues to be conducive to a large crop. Concerns, however, are developing over dryness in central southern Argentina. It’s still early for that area but the concerns are there.
With the bulge in the futures’ market on Monday most interior cash soybean bids ran easier on the day. The Gulf too ran easier vs. Friday’s posting. Soybean spreads ran steady to firm as most of the day’s buying was focused on the Jan and March contracts. The meal spreads acted in similar manner despite a lackluster looking cash market. With cash markets for both beans and meal looking as soft as they do and yet the flat price moves higher it all suggests this is a speculative driven market. On Friday the USDA will update supply-demand (this is not a production update) – they will remind us of a large US carryout as well as big SA crops.
The long term trend is higher for soybeans, sideways to higher for soybean meal and higher for soybean oil. If you believe in this trend analysis we focus on buying breaks to support in beans and bean oil while being a trader in soybean meal (buying breaks yet selling rallies as well). As of this writing I get the impression these trends will be with us for a while – at least until the SA crop is further established.
Jan Beans: $10.38 ($10.31) – $10.53 ($10.60) Jan Meal; $316.0 ($313.0) – $324.0 ($327.0) Jan Bn Oil: $37.20 – $38.10 (?)
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