Soybean Commentary
Jan Soybeans close ½ cent lower ($9.59 ¾), March 1 cent lower ($9.67 ¾), July 1 ¼ cents lower ($9.88) and Nov 1 ½ cents lower ($9.84)
Jan Soybean Meal closes $1.4 higher ($315.8), March $1.2 higher ($319.8), July $0.8 higher ($325.5) and Dec $0.1 higher ($325.2)
Jan Soybean Oil closes 2 pts lower ($33.74), March 3 pts lower ($33.87), July 4 pts lower ($34.19) and Dec 4 pts higher ($33.97)
Weekly Soybean Export Sales – old crop 600-900 K T. expected – new crop 0-100 K T. expected
Weekly Soybean Meal Export Sales – old crop 100-350 K T. expected – new crop none expected
Weekly Soybean Oil Export Sales – old crop 5-40 K T. expected – new crop none expected
If you’re a day trader Wednesday was decent day. In the early going both beans and meal had decent sell-offs to suspected support – follow through selling was lacking at these levels and short covering ensued. The end result was the bean and meal markets went nowhere fast. Bean oil had a quiet day as it digested its recent 140 pt rally. Brazilian weather remains conducive to crop development. We still have some dry areas in south, southeastern Argentina but there is better looking moisture in the 6-10 day forecast. As we look ahead to the 12th ideas are mixed on national yield changes (not much either way) while expecting decreases in export. Brazilian production ideas are expected to increase by 2.0 M T. CONAB will update on the 11th.
Interior soybean bids continue to move higher from relatively slow movement. The Gulf moves higher as well as anticipated logistical problems are creating some anxiety down there. For what it is worth the ULTRA cold that has been gripping the Midwest is expected to moderate starting late this coming weekend. Soybean spreads ran mixed to fractionally better. Interior offers to sell cash meal remain in the dumper. Reading between the lines suggests rail offers may be trying to improve. Meal spreads were slightly higher on the day.
Price action charts suggest soybeans and soybean meal are primed for a rally. I’m not sure what’s out there to prompt this other than the trade has tried to break the market and there hasn’t been any follow through. Any rally that does occur has to be viewed as technical in nature as both spreads and low implied volatility suggest the lack of any uncertainty.
Daily Support & Resistance for 01/05
March Beans: $9.60 – $9.75
March Meal; $316.5 – $322.5
March Bn Oil: $33.30 – $34.20
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.