November Soybeans closed ¼ cent lower ($9.23 ½), March ¼ cent lower ($9.49 ½) & July ¼ cent lower ($9.68 ½)
October Soybean Meal closed $1.3 lower ($304.1), Dec $1.9 lower ($307.8) & March $1.8 lower ($313.7)
October Soybean Oil closed 7 pts higher ($29.70), Dec 7 pts higher ($29.78) & March 7 pts higher ($30.27)
Weekly Export Soybean Export Sales – 2.092 M t. old crop vs. 1.300-1.800 M T. expected – 3.0 K T. new crop vs. none expected
Weekly Soybean Meal Export Sales – 364.7 K T. old crop vs. 100-300 K T. expected – no new crop vs. none expected
Weekly Soybean Oil Export Sales – 1.2 K T. old crop vs. 5-25 K T. expected – no new crop vs. none expected
USDA announces 398 K T. of soybeans sold to China
Highlights of USDA Soybean Production & Supply-Demand Report – Production declines by 83 M bu., Yield declines by 1.0 bpa, Harvested acres decline by 240 K – Carryin declines by 96 m Bu., Crush increases by 56 M bu., Exports unchanged, Carryout declines by 180 M bu., World carryout declines by 3.98 M T.
Long story short is that USDA production data came in lower than expected, usage data a bit higher than expected and carryout lower than expected. Unfortunately the bearish feed grain data stalled the soybean attempt to rally. As we move forward the next few weeks additional harvesting will help fine tune today’s data. Additionally; the outcome of the China/US trade talks will also be factored in. If the talks are successful China said they would buy another 10.0 M T. of soybeans. I couldn’t help but notice the USDA left soybean exports unchanged.
The interior soybean basis saw only minor changes on the day. Burns Harbor was 3 cents easier and Seneca, IL was 1 cent better. The Gulf is steady with its recent firmness. Soybean spreads saw only fractional changes within the current crop year while old crop gained a couple of cents on the new crop. We have to remember that the recent Chinese buying is front-end loaded; now into early January. The interior meal basis runs mostly steady with truck offers, slightly better with rail offers. The Gulf basis for meal has an underlying firm tone. Meal spreads ran unchanged to fractionally weaker.
Despite what looked like friendly looking USDA data the soy complex was not able to further recent gains. This price action will suggest that we may be looking at some downside correction. It is my thought that the bullishly inclined will stand pat until we see the outcome of the Chinese/US trade talks.
Daily Support & Resistance for 10/11
Nov Soybeans: $9.14 – $9.31
Dec Soybean Meal: $305.0 – $310.5
Dec Soybean Oil: $29.50 – $30.00
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