Soybeans Commentary


Soybeans – Just My Opinion

May Soybeans closed 13 ¼ cents lower ($8.36), July 12 ½ cents lower ($8.39 ½) & Nov 11 ½ cents lower ($8.45 ½)

May Soybean Meal closed $3.4 lower ($285.2), July $1.5 lower ($290.6) & Dec $2.0 lower ($295.4)

May Soybean Oil closed 35 pts lower ($25.63), July 35 pts lower ($25.91) & Dec 34 pts lower ($26.73)

USDA announces 396 K T. soybeans sold to China – 198 K T. old crop, 198 K T. new crop

Weekly Soybean Export Sales – old crop vs. 500 K – 1.000 M T. expected – new crop vs. 200-500 K T. expected

Weekly Soybean Meal Export Sales – old crop vs. 100-250 K T. expected – new crop vs. 0-75 K T. expected

Weekly Soybean Oil Export Sales – old crop vs. 5-25 K T. expected – new crop vs. 0-5 K T. expected

It looks like we saw a delayed reaction to yesterday’s old crop 580 million bu. carryout. Couple that with the idea soybean acres are going to increase leads to the wishing and hoping the Chinese will save the soybean market falling by the wayside. Rhetoric continues to go back and forth as to whether or not they will abide by Phase One/Phase Two agreement. For what it is worth Brazil is still a cheaper origin for old crop soybeans. Last but not least it looks like the new crop soybeans will get off to a good start for their growing season.

For the most part the interior soybean basis continues to show a firm tone. I’m not seeing the Gulf as anything special. Soybean spreads, the old crop/new crop, have been in a sideways mode for the few weeks but do look like they will widen as we move through time. Offers to sell cash meal are showing some signs of firming suggesting recent crush rates should be slowing. Meal spreads did show some slight firming in response to this.

July soybeans are now back in line to test the $8.30 interim support level. Failure to hold that level would suggest another leg down is coming. The same holds true for November soybeans if it fails to hold the $8.38-$8.37 level. July soybean meal continues to try and realize support. To get any upside going we need to see conclusive closes above the $296.0 level. Closes below $287.0 will sour this market.

Daily Support & Resistance – 5/14

July Soybeans – $8.30 – $8.50

July Soy Meal – $288.0 – $294.0

July Bean Oil – $25.50 – $26.50

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