Soybean Commentary
Sept Soybeans close 18 ½ cents higher ($9.60 ½), Nov 19 cents higher ($9.68 ½) and March 19 cents higher ($9.87 ½)
Sept Meal closes $9.6 higher ($302.8), Dec $9.2 higher ($308.0) and March $8.7 higher ($312.2)
Sept Bean oil closes 21 pts lower ($35.10), Dec 23 pts lower ($35.44) and March 22 pts lower ($35.79)
USDA announces 136.0 K T. soybeans sold to China
Weekly Soybean Export Inspections – 644.9 K T. vs. 575-700 K T. expected
Weekly Soybean Crop Ratings & Progress – 61% GE vs. 61% expected vs. 73% year ago – Setting Pods – 97% vs. 96% 5-year average – Dropping Leaves 11% vs. 12% 5-year average
Soybeans and soybean meal advance sharply on Tuesday. Weather considerations (possible frost in the north, northwest; possible hurricane in the southeast and dryness in selected areas) and pent up Chinese demand (I’m told China has limited October and November coverage) all worked together to prompt spec short covering. The bottom line – the finishing weather for the soybean crop appears less than desirable as of this writing. The soybean meal market has reasserted itself as it was the clear leader in the product markets.
The interior cash soybean markets took on a mixed look on Tuesday. Processors still show the best bids while selected river locations ran easier on the day. Soybean spreads ran unchanged Nov to March and then showed a bit of bull spreading. Selected locations are trying to improve their meal offers as we still have some locations having down time. Meal spreads showed a bullish bias as most months showed fractional improvement.
Soybean meal showed a very distinct buy signal as it rallied above the previous three weeks of price action. Meal’s short covering weighed on bean oil prices which had been the recent bullish bias of the products. Unwinding long bean oil/short soybean meal gave us a $1000 per contract move today. If the meal market can sustain this rally it will have Nov beans challenging the $9.90 – $10.00 level. December soybean meal should start realizing some resistance as it approaches the $312-$315 level. Bean oil registers a minor reversal on Tuesday as we saw new highs for its current rally followed by a lower close.
Daily Support & Resistance for 09/06
Nov Beans: $9.60 – $9.803
Dec Meal; $304.0 – $312.0
Dec Bn Oil: $34.70 – $35.60 (?)
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