Soybeans Commentary

storck

Just My Opinion – Soybeans

Soybean Commentary

Nov Soybeans close 2 cents lower ($9.55 ¼), March 1 ½ cents lower ($9.75 ½) and July 1 ½ cents lower ($9.91 ¾)

Dec Soybean Meal closes $2.1 lower ($311.5), March $2.2 lower ($316.6) and July $2.2 lower ($321.3)

Dec Soybean Oil closes 23 pts higher ($32.75), March 22 pts higher ($33.17) and July 21 pts higher ($33.58)

Soybeans and soybean meal grind lower in response to reports that yields, so far, are not that far off from what the USDA alluded to in September. Soybean oil catches a minor bid in response to a rally in palm prices as well as from inter-market spreading. Its Golden Week in China so new daily export sales’ announcements are not expected. Recently harvested soybeans backing up in the interior due to river logistical problems is not helping the demeanor of the trade.

The futures’ trade in soybeans is lacking in volatility – the cash trade is not. Overall basis levels are ugly but the recent spate of volatility is fun to watch. Here are some examples; the Ohio River jumps 13 cents overnight but the basis is still 52 under – just two days ago Decatur, IL was 15 cents under now it is 30 cents under – two days ago Seneca, IL was 80 cents under now it is 58 cents under – two days ago Davenport, IA was 69 cents under now it is 95 cents under. The meal basis stays soft as the interior has become a processor market since the river markets are having their transportation problems. Long story short – soybean and soybean meal spreads stay soft.

Soybean prices (Nov) remain in line to test the $9.50 level. Failure there would suggest something closer to $9.40. Soybean meal prices (Dec) remain in line to test support at $309. Failure there suggests $304. Bean oil is trying to advertise it has gone low enough for now. If bean and meal prices continue to grind lower bean oil is more likely to move into a consolidation phase near its recent low end vs. rallying out of the hole.

Daily Support & Resistance for 10/04

Nov Beans: $9.48 – $9.66

Dec Meal; $309.0 – $316.0

Dec Bn Oil: $32.25 (?) – $33.15

 

The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results.