Soybean Commentary
May Soybeans closed ½ cent higher ($10.28), July¼ cent higher ($10.39 ½) and Nov 1 ½ cents lower ($10.33 ¼)
May Soybean Meal closed $3.0 higher ($379.2), July $2.8 higher ($383.3) and Dec $0.4 higher ($375.2)
May Soybean Oil closed 2 pts higher ($30.81), July 3 pts higher ($31.09) and Dec unchanged ($31.83)
Weekly Soybean Export Sales – 371.3 K T. old crop vs. 400-700 K T. expected – 166.5 K T. new crop vs. 400-700 K T. expected
Weekly Soybean Meal Export Sales – 223.7 K T. old crop 100-300 K T. vs. expected – 40.8 K T. new crop vs. none expected
Weekly Soybean Oil Export Sales – 11.2 K T. old crop vs. 8-30 K T. expected – no new crop vs. none expected
Monday, April 30th, is 1st Notice Day for May Soybeans & Product Deliveries
Soybeans spin their wheels going nowhere fast on Thursday despite a modestly firm meal market. Soybean weekly export sales were deemed disappointing vs. expectations. Soybean traders remain in a state of flux due to the ongoing rift between China and the US. It has been reported that the US will send a group of US trade representatives to Beijing next week to see if some sort of accord can be reached. Supposedly Beijing is open to the idea of discussion. The meal market stays firm because Argentina is an absolute mess (as well as decent weekly export sales). In addition to their short crop they are now experiencing loading delays (ship rammed a dock at one of their busiest ports) as well labor disruptions as selected crushing facilities. Bean oil goes dead at recent lows struggling to register a 20 pt wide day.
With one exception the interior soybean basis stays firm. The one exception was Savanna, IL where recent advances were retraced. The Gulf did show some easing with last night’s posting. Soybean spreads within the old crop ran fractionally better while the old/new spreads showed some modest improvement. It will be interesting to see what kind of deliveries we see Sunday night, Monday morning given what’s happening in Argentina and the possibility of some sort of “rift” settlement with the Chinese. Interior offers to sell cash meal still look soft while the export market shows a steady to firm bias. Meal spreads were noticeably strong. There is not much meal registered for delivery (that can change but I doubt it) and given what happening with Argentina I doubt we’ll see any.
On April 10th July meal went into a downside corrective mode. The price action that we saw on Wednesday and again today suggest that corrective mode is coming to an end and prices appear ready to resume going higher. If true the worst case scenario for soybeans will be “staying alive”. It will come down to whether or not crush demand will be able to offset the slowing export demand. Bean oil shows a minor degree of oversold but we have seen that before.
Daily Support & Resistance for 04/27
July Soybeans: $10.25 – $10.55
July Soybean Meal; $378.0 – $390.0
July Soybean Oil: ??? – $31.50
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.