Soybean Commentary
August Soybeans 13 ½ cents higher ($10.13 ¼), Sept 14 ¼ cents higher ($10.18 ¼) and Nov 14 ½ cents higher ($10.27)
August Meal closes $3.9 higher ($330.5), Sept $3.8 higher ($332.5) and Dec $3.9 higher ($338.1)
August Bean Oil closes 51 pts higher ($33.97), Sept 53 pts higher ($34.11) and Dec 57 pts higher ($34.45)
Weekly Export Sales – Soybeans – 409.5 K T. old crop vs. 100-300 K T. expected; 1.522 M T. new crop vs. 1.300-1.800 M T. expected – Soybean Meal – 41.4 K T. old crop vs. 0-150 K T. expected; 75.9 K T. new crop vs. 50-150 K T. expected – Soybean Oil – 25.4 K T. old crop vs. 5-25 K T. expected; no new crop vs. 0-5 K T. expected
It’s all about the weather and whether or not the current undesirable conditions stick around as we move into August. I know there are a lot of areas where the soybean plants look rather sick – experience tells they can come back. I can remember in past years where many complained the plants were too short and how could they yield anything substantial – in the end many did have decent yields. That’s one reason why soybeans were introduced to the US back in the late 1930’s – it was because they could survive the mid-summer heat and dryness (as long as the rains came in August and early Sept).
River locations still appear to be interested in originating soybeans as most of their bids are holding onto recent gains. The Gulf continues to edge higher. It now appears the processor, where he has to compete with River origination, is bumping up his bids as well. August beans lose to November while November gains on its deferreds. I think that is reflective of the fund buying in the lead months of the new crop. The best that I can say about the meal basis is that it is steady at depressed levels. Meal spreads ran flat out to January and then gained on the deferred contracts.
Soybeans challenged last Tuesday’s to Wednesday’s opening gap. The price action did not really reject these levels – it just seemed the flat price slowed down as the trade sits and waits for further weather developments/forecasts. Like corn – from a strict technical approach these levels are supposed to be sold. Unfortunately the primary issues are all about weather. Do the charts know the weather forecast or should I ask do the weather forecasts know the charts? Once again we are setting the stage for a high anxiety Sunday night, Monday morning.
Daily Support & Resistance for 07/21
Aug Beans: $10.00 – $10.20
Nov Beans: $10.12 – $10.34
Aug Meal; $326.0 – $335.0
Aug Bn Oil: $33.50 – $34.50
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