Soybean Commentary
July Soybeans closed 5 ¼ cents higher ($10.30 ½), August 5 ¼ cents higher ($10.34 ¼) & Nov 5 ¼ cents higher ($10.39)
July Soybean Meal closed $1.6 lower ($377.5), August $1.2 lower ($377.5) & Dec $0.3 lower ($373.3)
July Soybean Oil closed 9 pts higher ($31.51), August 10 pts higher ($31.63) & Dec 12 pts higher ($32.30)
Soybeans further Monday’s rally but in an unconvincing manner as the meal market balks. Bean oil managed to eke out another higher close but well off of the day’s highs. Bull traders remain positive over the outcome of last weekend’s US/China meetings as both sides agreed to shelve the tariff threats for the time being. Many want to believe China will return to the US for soybeans based on this outcome. As of this writing the best source for soybeans (and soybean meal for that matter) is either Brazil or Argentina as both of these countries offerings are cheaper than US origin.
The interior cash soybean markets reads steady to better. The better bids are coming from river locations as soybean movement has slowed despite the recent rally form late last week. Soybean spreads ran steady upfront weaker vs. Jan forward. The biggest feature is the collapse of the soybean meal export market. Bids ran $6.0 lower while offers were down $3.0. Meal spreads are the softest they have been in quite some time.
Flat price meal continues to honor recent support levels but just barely. I have to think we have some big sell stop territory just below the $374.0 level basis July. If the meal market breaks down I have to think the soybean market won’t be far behind. If you have been reading my thoughts for any length of time you know my thoughts on this – if the meal market can’t make it then the soybean market won’t either.
Daily Support & Resistance for 05/23
July Soybeans: $10.10 ($10.00) – $10.35
July Soybean Meal; $374.0 (?) – $382.0
July Soybean Oil: $31.05 – $31.65
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