November Soybeans closed ½ cent lower ($9.33 ¼), March 1 cent lower ($9.58 ½) & July ¼ cent higher ($9.76 ¾)
December Soybean Meal closed $3.0 lower ($305.6), March $2.9 lower ($311.8) & July $2.9 lower ($318.7)
December Soybean Oil closed 76 pts higher ($31.34), March 76 pts higher ($31.81) & July 74 pts lower ($32.36)
Weekly Soybean Export Sales – 475.2 K T. old crop vs. 800 K – 1.600 M T. expected – no new crop vs. none expected
Weekly Soybean Meal Export Sales – 110.5 K T. old crop vs. 100-300 K T. expected – -0.3 K T. new crop vs. none expected
Weekly Soybean Oil Export Sales – 3.3 K T. old crop vs. 0-25 K T. expected – no new crop vs. none expected
USDA announces 264.0 K T. of soybeans sold to China
There was a fair amount of “push-pull” impacting the soybean market on Thursday. One example was the surging higher bean oil market (bio-diesel demand & higher palm) vs. the sagging bean meal market (domestic market can’t find buyers). China announced it would buy $20 billion of US Ag products in the first year of “Phase One” if and when a deal is reached. That kind of dollar amount puts us back to the pre-tariff nonsense, basically 2017. The however is when will the first year kick in; will recent purchases be part of this package? Weekly export sales were hugely disappointing as it featured nearly 584.0 K T. of reductions to unknown destinations. Offsetting some of this was the USDA announcing 264.0 K T. of soybeans sold to China under its daily reporting system. Last but least keeping the soybean market as well as the corn and wheat markets on edge is the Argentine elections this weekend. The outcome here could have major impact on the marketing and growing decisions of the Argentine producer. As I said we saw a lot of push-pull and the end result was the soybean market going nowhere fast.
The interior soybean basis markets continue to show a firm tone as harvesting is happening as we speak but not much is getting sold. The Gulf is now jumping higher vs. its recent edging higher as the cash trade reacts to the latest Chinese announcements as well as the announced sale this morning. The upfront spreads involving November were firm but then died off May forward; Nov, Jan & March all lost to May forwards. For what it is worth November soybean option expirations is tomorrow. Cash offers to sell meal in the interior continue to look for buyers while the Gulf tried to firm ever so slightly. Meal spreads ran steady to easier out to July.
For the past week Nov beans have traded in a tight 17-18 cent range. I can’t imagine this lasting much longer. Violation at either end of this range should spark an increase in volatility in whatever that direction may be. I know the trade wants to be bullish but what you want vs. what actually happens, more times than, goes against you. Soybean meal, too, continues to be a tight trading range affair. Bean oil trades at high levels not seen since February of last year. Strength in bean oil can keep the soybean market alive but not much more than that as long as the meal market continues to dog it.
Daily Support & Resistance for 10/25
Nov Soybeans: $9.27 (?) – $9.43
Dec Soybean Meal: $303.0 – $309.0
Dec Soybean Oil: $30.85 – $31.60
The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results.