January Soybeans closed ½ cent higher ($8.71), March ¼ cent higher ($8.85 ½) & July ½ cent higher ($9.14)
December Soybean Meal closed $1.2 higher ($292.5), March $0.9 higher ($297.9) & July $0.3 lower ($304.8)
December Soybean Oil closed 3 pts higher ($29.99), March 4 pts higher ($30.49) & July 5 pts higher ($31.16)
The string of higher night session prices followed by lower day session prices has ended; Jan soybeans managed to finish a ½ cent higher. On the day it was a tight trading range; not even an 8 cent range. I think Monday’s 14-day RSI at 19.01 limited any new selling; unfortunately it did not prompt any new buying. The rhetoric around the trade talks with China does not suggest we are getting anywhere close to an agreement. I’m told China is still actively pursuing Brazilian origin. The month long rebound in Board crush margins is keeping the price of soybeans depressed. Weather in Brazil remains highly conducive to their having a highly successful crop. There are some minor concerns about developing dryness in portions of Argentina but so far it has having little impact. If Brazil is going to have a 123.0 M T. soybean crop I don’t think it will mean much if Argentina loses a few tons off of their projected 53.0 M T. crop.
The interior soybean basis ran mostly steady on Tuesday with a couple of exceptions; Decatur, IN was 5 cents better, Lincoln, NE was 15 cents better and Davenport, IA 1 cent easier. The Gulf continues to be firm as the midday posting saw a 1 cent better bid and a 1 cent easier offer. Soybean spreads were mostly flat on the day with only mixed fractional changes. Soybean meal rail offers showed some improvement on Tuesday while truck offers ran unchanged. The meal basis at the Gulf runs unchanged. Meal spreads had a bullish bias which appears to be tied to some minor flat price short covering.
January soybeans are honoring the Sept interim low at $8.65. Other than that I did not see much character to today’s trade. For what it is worth Jan beans are showing a double bottom on the shorter term time charts. The product trade is holding recent lows but not offering much else. Without a legitimate threat to the SA crop and the continuing impasse on trade talks I question what’s out there to prompt a sustaining rally in the soybean market. One item to watch for is the new regime that is slated to take over in Argentine as they are expected to raise export taxes on agriculture as early as Dec 10th. That just might get the US some additional soybean and soybean meal business from non-China but so far this is just speculation. Soybean oil will continue to take its cue from the goings on in palm oil.
Daily Support & Resistance for 12/04
Jan Soybeans: $8.65 (?) – $8.83
Jan Soybean Meal: $292.5 (?) – $299.0
Jan Soybean Oil: $29.80 – $30.60
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