January Soybeans closed 6 ¼ cents lower ($8.70 ½), March 6 cents lower ($8.85 ¼) & July 4 ¾ cents lower ($9.13 ½)
December Soybean Meal closed $0.4 higher ($291.3), March $0.1 lower ($297.0) & July $0.3 lower ($305.1)
December Soybean Oil closed 46 pts lower ($29.96), March 40 pts lower ($30.45) & July 36 pts lower ($31.11)
Weekly Soybean Export Inspections – 1.547 M T. vs. 1.400-2.000 M T. expected
Weekly Soybean Harvest Progress – 96% vs. 97% expected vs. 99% 5-year average
Higher soybean prices in the night market have been the kiss of death for the day market in recent days. Today was no different as at one point last night Jan soybeans were 6 cents higher only to trade 9 cents lower during the day session. Still no indications of a trade deal with China happening any time soon. China wants assurances that there will be no more new tariffs as well as wanting the removal of existing tariffs. I did not see any response from the US administration regarding these requests. Weekly soybean export inspections favored the low end of expectations. Profit taking on long soybean oil enters its third week. Inter-market spread support for soybean meal was minimal at best. The weather for the developing soybean crop in Brazil couldn’t be much better than it is now. The latest poll from Reuters is suggesting their crop size could be as great as 122.7 M T. vs. 117.0 M T. last year vs. the USDA’s current estimate of 123.0 M T. There is some concern that dryness is creeping into southern Argentina. The forecast for this area has a dry bias for the next 10-14 days.
The interior soybean basis continues to show a firm bias. River locations continue to improve while processors run steady. The Gulf is holding its own. Despite what looks like a strong basis the nearby soybean spreads continue to widen. The longer it takes to get a deal down with China the lesser the chance of doing any meaningful business done as new crop soybeans will become available from Brazil as early as late February. Offers to sell cash soybean meal in the US interior continue to look cheap. Soybean meal offers for export continue to hold onto recent strength. Meal spreads show a slight improving bias.
Interim support for January soybeans is supposed to be the mid-$8.60’s. We flirted with that today. Jan soybeans did register its lowest close dating back to last May. The 14-day RSI now sits at 19.02. Jan meal prices are sitting at contract lows. Jan bean oil should try and realize some support against the $29.80 level. Failure there would suggest something closer to $29.50.
Daily Support & Resistance for 12/03
Jan Soybeans: $8.65 (?) – $8.83
Jan Soybean Meal: $291.0 – $298.0
Jan Soybean Oil: $29.80 – $30.50
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.