Soybean Commentary
August Soybeans 16 cents lower ($9.81 ½), Sept 16 ½ cents lower ($9.86) and Nov 17 ¼ cents lower ($9.92 ¾)
August Meal closes $7.6 lower ($318.3), Sept $7.5 lower ($320.3) and Dec $7.8 lower ($324.9)
August Bean Oil closes 11 pts lower ($33.50), Sept 11 pts higher ($33.62) and Dec 8 pts lower ($33.97)
Conditions ratings come in lower than expected Monday afternoon – that has soybeans sharply higher (25 cents higher) with the onset of the night session. That rally lasted for minutes only and the balance of the night session, day session was spent grinding lower. When it was all said and done Nov Beans sold off by 43 cents and finished on the lows of the day. So what happened? Its all about the short term forecasts – over the next few days rain is forecasted for some of the recently drier areas on the Midwest. Following weather is expected to cool but with a drier bias. If this forecasted rain event comes to fruition it would be a good start to the month of August, the month that is most critical to soybean development.
Most interior soybean locations are showing higher basis levels. The processor basis, especially where he has to compete with export, shows a better basis. All River locations show better basis levels. Nearby soybean spreads are responding accordingly with the better basis levels. The meal basis remains depressed whether its for domestic use or for export. Meal spreads ran mostly steady up front fractionally better vs. the deferred contracts.
Last week I talked about the bean and meal price action showing up as upflags. That holds true today and any decent downside action tomorrow will suggest this formation is breaking down. Failure to hold the July 14th low, $9.84 ($9.80 on the outside), will suggest we break another 30 cents or so. Whether this happens or not is contingent on whether or not the forecasted rain event over the next couple of days comes to fruition.
Daily Support & Resistance for 07/26
Aug Beans: $9.70 – $9.98
Nov Beans: $9.80 – $10.10
Aug Meal; $314.0 – $326.0
Aug Bn Oil: $32.85 – $33.95
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