Soybean Commentary
May Soybeans closed 2 ½ cents higher ($10.38), July 3 cents higher ($10.49 ¼) and Nov 2 ¼ cents higher ($10.42 ¼)
May Soybean Meal closed $2.7 higher ($380.0), July $2.9 higher ($383.3) and Dec $2.3 higher ($372.6)
May Soybean Oil closed 30 pts higher ($32.34), July 32 pts higher ($32.62) and Dec 34 pts higher ($33.29)
Soybeans and soybean meal try to run higher as China failed to name soybeans as a sanctioned commodity in their official announcement to the WTO. The end result was a less than auspicious close as settlement prices favored the low side of their respective daily ranges. Mid-session saw bean oil jump about 70 points. The “however” here is that bean oil finished at midrange. I have to think the fear of possible Chinese sanctions is still with the trade participants as evidenced by the recent failings of holding the early rallies.
Interior cash bids for soybeans are mixed. Processors stand in for soybeans as Board crush continue to show an upwards bias. River bids are mixed as some read better while other locations read soft. What soybean movements we have seen of late are mostly new crop sales. May beans lose to July while July is steady to firm out to January. I don’t see much happening with the interior meal basis as offers continue to look for buyers. Meal spreads ran similar to soybean spreads – May loses to July while July gains on the new crop.
As I look at the recent attempts to rally in beans and meal I get the impression the trade is trying to force prices higher and that’s why we have seen the inability to hold intra-day rallies over the past 2 days. Maybe my perception is all wrong – we have the stocks to meet the current demand and any shifting that may come out of Argentina – If corn or spring wheat has problems with timely planting it gets us more soybean acres. Since Thursday’s late trade chasing rallies has not been real rewarding for the soybean and soybean meal traders. From a pure technical standpoint it’s the bean oil market that shows the least risk with recent ownership.
Daily Support & Resistance for 04/04
July Soybeans: $10.42 ($10.32) – $10.61
July Soybean Meal; $375.0 – $387.0
July Soybean Oil: $32.30 – $32.90
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.