January Soybeans closed 7 ¾ cents lower ($8.93 ½), March 7 ½ cents lower ($9.08) & July 7 cents lower ($9.35)
December Soybean Meal closed $3.6 lower ($293.3), March $3.1 lower ($299.3) & July $1.4 lower ($307.4)
December Soybean Oil closed 24 pts lower ($31.23), March 24 pts lower ($31.71) & July 24 pts lower ($32.30)
USDA announces 585 K T. of soybeans sold to China & 140 K T. of soybeans sold to unknown
Weekly Soybean Export Sales – old crop vs. 500 k – 1.100 M T. expected – new crop vs. none expected
Weekly Soybean Meal Export Sales – old crop vs. 125-300 K T. expected – new crop vs. none expected
Weekly Soybean Oil Export Sales – old crop vs. 8-30 K T. expected – new crop vs. none expected
The USDA announces 12-13 cargoes of soybeans sold (585 K T. to China & 140 K T. to unknown) and the soybean market’s response is lower. This is classic “buy the rumor – sell the news”. Outside analysis is suggesting China won’t need that much more from the US as new crop from Brazil comes online in mid to late February. Crop development conditions in Brazil appear to be pretty good. I’m told southern Argentina just received some “unexpected” rainfall today. This is not a pattern breaker as southern Argentina is forecasted to maintain a dry bias for another 10 days or so. Northern Argentine continues to be in good condition. We saw a new round of soybean meal deliveries, 500, against the December contract. This suggests more than ample supplies of soybean meal. I’m also told that Argentine crushers have started offering meal again after pulling offers last week in response to a prominent processor having major financial problems. Soybean oil eases in response to palm oil correcting lower after its recent meteoric rise. As far as the US/China trade talks are concerned it’s anyone’s guess. Supposedly the Washington powers on high will discuss the latest round of scheduled tariffs for December 15th tomorrow.
Most interior soybean basis levels run steady on the day. The underlying tone continues to be firm mostly form slow movement. The Gulf eases ever so slightly from recent strength. Soybean spreads within the current crop year ease fractionally. The recent attempt to improve the old crop/new crop spreads just may have run its course. Offers to sell cash meal either for domestic use of for export run unchanged. Meal spreads got noticeably beat up. New deliveries and resumed offers from Argentina will do that.
Soybean charts are trying to suggest the recent 36 cent rally in January soybeans is over. Thursday is export sales day; will they be able to revive the rally? Suspected support from the recent rally is the $8.85 level. Last week’s rally in soybean meal has nearly been erased. Last week’s contract low in Jan meal is $292.6. Today’s close is only $2.4 away. Is bean oil’s rally stalling out or is it the pause that refreshes? Bean oil will continue to take its cue from palm oil and currently that appears to be in a bit of a corrective phase.
Daily Support & Resistance for Dec 12th
Jan Soybeans: $8.85 – $9.01
Jan Soybean Meal: $292.5 (?) – $298.5
Jan Soybean Oil: $31.20 – $31.70
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