Soybean Commentary
Nov Soybeans close 2 cents higher ($9.86), March 2 ¼ cents higher ($10.06 ½) and July 1½ cents higher ($10.23 ½)
Dec Soybean Meal closes $0.6 lower ($316.1), March $0.1 lower ($321.1) and July $0.2 lower ($326.1)
Dec Soybean Oil closes 29 pts higher ($35.02), March 30 pts higher ($35.40) and July 32 pts higher ($35.82)
The trade is anticipating a bearish looking corn report so they are leaning on corn prices. The trade is anticipating a friendly looking soybean report so they are supporting soybean prices. For all practical purposes the soybean harvest is mostly done so the attitude is no more “hedging” from cash movement. It is a bit disturbing that bean oil is the strength within the products as experience/history suggests it is tough to sustain a bull market in soybeans when led by soybean oil. Not to discount the bean oil market as it does have its own story from bio-diesel demand.
Interior cash soybean prices are showing a mixed to firm bias. Processors show the best bids. River locations are flip-flopping back and forth amongst one another – where beans are needed basis firms while where there are not needed basis eases. Gulf prices are bouncing back from last week’s weakness realizing beans may be hard to come by realizing harvest is just about over. A word of note – I am hearing that many that follow the export market feel sales and shipments of soybeans will soon be declining as China continues to favor SA origin.
The channel higher that started back in mid-August for soybeans remains intact. Because the trade is expecting a friendly soybean report from the USDA it would not surprise me to see its October high ($10.22 March) challenged over the next day and a half. I do see sell stops accumulating just below Monday’s low and again just below last week’s low. Bean oil has a similar picture; a higher channel that started in early October. Soybean meal is no better than sideways as it hovers just above recent interim lows. Anyone that is trying to be friendly to the meal market you do not want to see last week’s lows taken out.
Daily Support & Resistance for 11/08
March Beans: $9.96 – $10.14
Dec Meal; $312.0 – $319.0
Dec Bn Oil: $34.40 – $35.15 (?)
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