Soybean Commentary
March Soybeans close 2 ¼ cents lower ($10.64 ½), July 2 ¾ cents lower ($10.83) and Nov 3 ¼ cents higher ($10.45 ½)
March Soybean Meal closes $4.8 lower ($384.5), July $3.7 lower ($387.7) and Dec $0.7 lower ($371.0)
March Soybean Oil closes 29 pts higher ($32.30), July 29 pts higher ($32.69) and Dec 32 pts higher ($33.17)
USDA announces 120 K T. soybeans sold to China
After looking at the entire soy complex trade on Tuesday I come up with this perspective – it’s all reactive/correctional in nature. Board crush spreads have been correcting for the past 4 days. Old crop/new crop soybean spreads have been correcting for the past two days. Old crop/new crop soybean meal spreads have been correcting for the past three days. Soybean Meal/Soybean Oil spreads have been correcting for the past two days. Flat price old crop soybeans have been trading inside of last Friday’s range for the past two days. Flat price soybean meal has been a corrective mode for the past 2 ½ days. Flat price soybean oil has been in a minor sideways for the past 8-10 days. So what’s it all mean? I have to think the trade has gone into a state of flux biding their time to see what the USDA has to say on Thursday as well as updates from CONAB (early Thursday morning). Updates on Argentina are also being waited on.
The interior cash soybean market is showing a steady to defensive tone. The Gulf market appears to show some slight easing as well. Soybean spreads showed a clear bearish bias on Tuesday especially old crop vs. the new crop. The interior meal basis stays soft looking while it looks like the export market for meal continues to be firm. Meal spreads, like the soybean spreads, had bearish look all the way out to the new crop. All of the aforementioned appears consistent with my view that the soy complex is in a short term state of flux.
Recent price action suggests soy complex traders are content to sit and wait to see what kind of fundamental data is thrown at us on Thursday. While the trade sits and waits minor corrections/consolidation of the recent price action is being noted. I see no reason why this should change between now and Thursday.
Daily Support & Resistance for 03/07
May Soybeans: $10.65 – $10.85
May Soybean Meal; $382.5 – $396.5
May Soybean Oil: $32.10 – $32.80
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.