Soybean Commentary
March Soybeans close 16 ½ cents higher ($9.86 ¼), July 16 ¼ cents higher ($10.07 ½) and Nov 14 cents higher ($10.05 ½)
March Soybean Meal closes $4.7 higher ($331.7), July $4.2 higher ($337.5) and Dec $2.5 higher ($334.8)
March Soybean Oil closes 66 pts higher ($33.16), July 63 pts higher ($33.55) and Dec 63 pts higher ($33.86)
Weather, weather, who’s got the weather? Logistical problems get recently harvested product to port in Brazil, trucker threats in Argentina and forecasts not staying consistent for areas of concern in Argentina all worked together to reverse the recent 2-day break in soybeans and most of the recent 2-day break in soybean meal. Rumors re-emerged in bean oil around bio-diesel tax credits allowed that market to rebound erasing the past 3 days of lower prices. Going forward I have to think it will all come down to the crop development in Argentina. Logistical problems in Brazil are short term speed bumps and don’t last. Its going to come down to can the Brazilian soybean crop offset what Argentina may lose.
Not much happens with the interior cash soybean and soybean meal markets. Export markets for both appear stable. Soybean spreads gain fractionally within the crop year while noticeably better vs. the new crop. We are in a time frame where soybean exports have begun to sag – will the problems in SA revive our export markets? I think it may in the short but in the long term I remain suspect.
Soybeans and soybean meal are now in line to test interim resistance that was with last week’s sell-off. That resistance begins about another 4-5 cents in soybeans and about another $3-$4 higher in soybean meal. Traders are suggesting we are going to see another noticeable hike in the US soybean carryout – if true It will be tough to for the bean and meal markets to eclipse the levels we saw just two weeks ago.
Daily Support & Resistance for 02/07
March Beans: $9.77 ½ – $9.93
March Meal; $329.0 – $337.0
March Bn Oil: $32.80 – $33.55
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