January Soybeans closed 14 ½ cents higher ($9.22), March 14 ½ cents higher ($9.36) & July 14 ½ cents higher ($9.62)
January Soybean Meal closed $4.4 higher ($301.3), March $4.5 higher ($305.8) & July $3.9 higher ($312.1)
January Soybean Oil closed 54 pts higher ($33.14), March 56 pts higher ($33.43) & July 54 pts higher ($33.95)
Weekly Soybean Export Inspections – 1.259 M T. vs. 900 K – 1.600 M T. expected
NOPA November Crush – 164.9 M Bu. vs. 172.0 M BU. expected – Soybean Oil Stocks – 1.448 billion lbs. vs. 1.423 billion lbs. expected
Spec and fund shorts are on the run. It’s a combination of factors; the China deal, Argentina hiking export taxes and the idea we might see a lower production figure in the US in January from the USDA (lower harvested acres and lower yield). The weather in most of Brazil appears conductive to crop development; the north, northeastern has some dryness concerns. Argentina in the north is getting plenty of moisture while in the south dryness concerns continue.
The interior soybean basis continues to run steady to firm. The Gulf holds strong as well. Soybean spreads within the current crop year ran steady to fractionally mixed while old crop is a noticeable gainer on the new crop. The rationale there is the potential for better old crop business while acreage for new crop will rise. The interior basis and the export basis for soybean meal is fully steady. Meal spreads saw fractional increase in the old crop while old crop gains noticeably on the new crop.
So – how much soybean business can we do with China before the new crop from Brazil comes online? January soybeans are now in line to test the $9.30 – $9.40 resistance level. If the trade gets really excited we’ll look at the $9.50-$9.60 level basis January. What would it take to get the trade really excited – problems in SA. So far it is only southern Argentina that has any concern due to ongoing dryness. Soybean oil’s next upside target is $34.00 followed by something closer to $36.00. Soybean meal continues to be the weak sister when comparing chart formations, but the daily chart is showing an almost impressive looking double bottom against the $292.5 level (January). The Jan meal chart does show some trendline resistance just above the $3.05.0 level. Given all that’s going on in the global soybean market I must think that level will fall by the wayside sooner vs. later.
Daily Support & Resistance for Dec 17th
Jan Soybeans: $9.09 – $9.30
Jan Soybean Meal: $297.5 – $305.0
Jan Soybean Oil: $32.50 – $33.80
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