July Soybeans closed 7 cents higher ($8.57 ½), August 6 ¼ cents higher ($8.59) & Nov 5 ¾ cents higher ($8.66 ¼)
July Soybean Meal closed $2.6 higher ($286.3), August $2.7 higher ($288.4) & Dec $2.1 higher ($294.3)
July Soybean Oil closed 8 pts lower ($27.86), August 7 pts lower ($28.05) & Dec 9 pts lower ($28.68)
USDA announces 186 K T. soybeans sold to unknown (66 K T. old crop, 120 K T. new crop)
Weekly Soybean Export Sales – old crop vs. 500 K – 1.000 M T. expected – new crop vs. 100-500 K T. expected
Weekly Soybean Meal Export Sales – old crop vs. 200-600 K T. expected – new crop vs. 0-50 K T. expected
Weekly Soybean Oil Export Sales – old crop vs. 8-40 K T. expected – new crop vs. 0-5 K T. expected
Continued reports of Chinese interest in addition to recent announcements has the soybean market edging up to suspected resistance. What was different about today’s rally was that the soybean meal market was the leader of the products. In recent days soybean oil had been the product leader. The continued weakness in the US Dollar has really made US soybeans the cheaper origin vs. Brazil. If the meal market can continue its leadership role it will allow July beans to move through its suspected $8.60 resistance and more importantly sustain the rally.
The interior Midwest soybean basis are not showing many changes but what changes there is are higher. Lincoln, NE is 5 cents higher and interior river locations continue to show a higher bias. The Gulf market is firm in response to the recent Chinese buying. Soybean spreads are showing a bullish bias reflecting the better basis. Offers to sell cash soybean meal don’t do a whole lot. The interior is quiet with not a lot of direction while the export market is holding onto its recent firming. Soybean meal spreads showed a friendly bias on the day.
It’s a little spooky that flat price soybeans are challenging suspected trading range highs yet today’s daily range was one of the quietest we have seen. The other side of that is today’s close is the best we’ve seen dating back to mid-April. July soybean meal gives us its best close dating back to May 15th. Soybean oil is showing evidence that it is honoring the suspected $28.00 resistance level. For what it is worth the meal/oil spread has been trending lower since mid-late March and is now in support. Just because a market is in support doesn’t make it bullish but it does suggest low risk for ownership.
Daily Support & Resistance – 6/04
July Soybeans: $8.49 – $8.64 (?)
July Soy Meal: $283.0 – $288.0
July Bean Oil: $27.50 – $28.20
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.