Soybean Commentary
Nov Soybeans close 7 cents higher ($9.84), March 7 cents higher ($10.04 ¼) and July 7 ½ cents higher ($10.22)
Dec Soybean Meal closes $2.2 higher ($316.1), March $1.7 higher ($321.2) and July $1.7 higher ($326.3)
Dec Soybean Oil closes 31 pts higher ($34.73), March 29 pts higher ($35.10) and July 29 pts higher ($35.50)
Weekly Soybean Export Inspections – 2.490 M T. vs. 2.300-2.800 M T. expected
Weekly Soybean Crop Progress – 90% harvested vs. 91% expected vs. 91% 5-year average
Last Friday the complex broke hard as everyone was touting the weaker Brazilian currency. Today that currency retraced a good portion of Friday’s losses. Is the bean trade that easy – just follow the Brazilian currency? I don’t think so. Export sales continue to be impressive looking (some are trying to suggest we are looking at the last or near last of the big numbers as SA origin continues to undercut the US). Trade guesses are looking for a slightly smaller crop size/carryout from the USDA on Thursday. Brazilian weather appears to be conducive to getting the crop planted and up and growing. US harvest is winding down so any recent producer sales should wind down as well. Bean oil rebounded rather smartly on Monday – I believe on the coattails of the higher energy sector.
The interior cash soybean market has a mixed look on Monday. Some locations read better while others read easier. The Gulf continues to look depressed. Soybean spreads within the current crop year ran mostly steady while old crop gains a bit on new crop. Offers to sell cash meal remain depressed yet spreads there appear to be trying to improve. Talk continues to circulate that processors are continuing to have a tough time making hi-pro meal. That I’m told will be pretty much the story for the balance of the marketing year. The CBOT will change delivery specs in January of 2019 reducing the protein requirements. Am I missing something here with the idea that we can see delivery squeezes due to the lack of hi-pro supply?
Choppy type trade (lack of follow through in either direction) should be with us until we see what the USDA has to say on Thursday. Some larger profile firms are touting the possibility of a higher yield on Thursday while trade consensus suggests a slightly lower yield.
Daily Support & Resistance for 11/07
March Beans: $9.92 – $10.14
Dec Meal; $312.0 – $319.0
Dec Bn Oil: $34.40 – $35.15 (?)
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