Soybeans Commentary


Soybeans – Just My Opinion

January Soybeans closed 7 ¾ cents higher ($8.97 ¼), March 8 cents higher ($9.11 ¾) & July 7 ¼ cents higher ($9.38 ¾)

December Soybean Meal closed $0.7 lower ($296.7), March $0.3 lower ($302.2) & July $0.2 lower ($308.2)

December Soybean Oil closed 35 pts higher ($31.36), March 36 pts higher ($31.86) & July 34 pts higher ($32.47)

Weekly Soybean Export Inspections – 1.327 M T. vs. 800 K – 1.600 M T. expected

Over the weekend China issued a new tariff free quota for US soybeans. It is said that they granted 2.0 M T. to selected private and international crushers. In October China set a target to grant up to 10.0 M T. of tariff free soybean imports of which 6.0 – 7.0 M T. have already been used. With this said “traders in the know” are suggesting China may have bought 2-5 cargoes overnight. Last week the soybean meal market tried to assert itself from the story that a prominent Argentine crusher is have having major financial problems. The thought was that some business may come to the US but since then cooler heads have prevailed and the meal market is back to losing to soybean oil. It is thought the new regime in Argentina will implement a hike in export taxes. Today the Argentine ag minister said they will look at this before making any new decisions. Soybean oil continues to catch its cue from a “sky high” rally in palm oil. I’m told that palm oil is now a premium to soybean oil which has not happened dating back to February 2011.

The interior soybean basis continues to run with a steady to firm undertone with one exception; Davenport, IA is off 18 cents vs. Friday’s posting. The midday Gulf posting runs better with the rumored Chinese soybean purchases. Soybean spreads ran fractionally firm all the way out to the new crop. The interior soybean meal continues to show a soft look as far as I’m concerned. The meal export basis is steady but nothing to write home about. Jan meal spreads ran about $0.5 softer while the March spreads saw only fractional losses.

Jan soybeans poke their nose above the $9.00 mark but are unable to finish there. We’ll see what kind of confirmation we get tomorrow on today’s rumored purchases. Tomorrow’s Supply-Demand report is expected to show an unchanged carryout from November. Jan meal looks like it is downflagging from last Thursday’s rally. Jan bean oil looks like it is ready to test again its 2019 highs, $32.25

Daily Support & Resistance for 12/10

Jan Soybeans: $8.86 – $9.10

Jan Soybean Meal: $296.0 – $304.0

Jan Soybean Oil: $31.10 – $32.00

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.