Soybeans Commentary


Soybeans – Just My Opinion

May Soybeans closed 7 ¼ cents lower ($8.47), July 6 ¾ cents lower ($8.55 ½) & Nov 5 cents lower ($8.65 ½)

May Soybean Meal closed $1.1 lower ($287.5), July $1.4 lower ($293.1) & Dec $2.7 lower ($298.7)

May Soybean Oil closed 16 pts lower ($26.74), July 11 pts lower ($27.16) & Dec 6 pts lower ($28.04)

Export sources that I trust to be reliable suggest that during the month of April Brazil will export nearly 13 M T. of soybeans. That sure doesn’t leave much room for US origin. The meal market continues to ratchet lower from fears that demand will soften from slowing hog feeding. The fear is that as long as processing plants are shut/idle feeder pigs will get culled. Soybean oil gets no help either as bio-diesel demand slows as does the offtake from food demand.

Processor soybean basis levels are steady. Board crush margins try to stabilize as they approach season’s lows. Locations that are involved with soybean export are seeing slightly better basis levels as soybean movement remains minimal. The Gulf basis for soybeans stay relatively firm. Soybean spreads continue to ease from upfront spec liquidation as well as from ideas that new crop soybean acreage could shrink from accelerated corn plantings. How much of today’s bear spreading from the last day of index fund rolling remains to be seen. I’m not seeing much change in the interior soybean meal offers. This holds true for the Gulf as well. Meal spreads showed some attempt at firming for the first time in the last week and half. NOPA crush for March will be out tomorrow. Will there be any signs of easing?

$8.55 was deemed as interim support for July soybeans. Last week we bounced 20 plus cents off of that level and now we are back to that level. Short term inter-day indicators are reading rather low. If we do see additional follow through selling I can’t imagine its any worse than $8.45-$8.40. July soybean meal did show some bounce late in today’s session. Unfortunately we are still in new contract low ground. If we do get some follow through bouncing I can’t imagine it will be any better than the $297-$298 level. July soybean oil tries to stabilize after registering an interim downside reversal on Monday. Best case scenario for bean oil is the development of a tight trading range affair. In the near term I’m looking at $27.60 to be resistance and $26.75 to be support.

Daily Support & Resistance – 4/15

July Soybeans – $8.50 (?) – $8.65

July Soy Meal – ??? – $299.0

July Soy Oil – $26.70 – $27.60

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.