July Soybeans closed 1 ½ cents lower ($8.63 ¼), August 1 ½ cents lower ($8.66) & Nov 1 ½ cents lower ($8.76 ½)
July Soybean Meal closed $1.3 lower ($287.1), August $1.3 lower ($289.7) & Dec $0.9 lower ($297.1)
July Soybean Oil closed 13 pts higher ($28.23), August 12 pts higher ($28.41) & Dec 12 pts higher ($29.14)
2019/20 Brazil Soybean Production (CONAB) – 120.4 M T. vs. 120.3 M T. last month vs. 124.0 M T. USDA
Soybeans and soybean meal continue to back and fill last week’s rally. Soybean oil gets some modest help from higher Malaysian palm oil. The condition of the recently planted soybean crop looks good and forecasts going forward do not offer much of a threat. A late in the day rumor had China buying a couple of cargoes for winter delivery. Given the continued decline in the US Dollar I say buy more. Brazilian soybean production was adjusted up by 100 K T. to 120.4 M T. by CONAB. The USDA will have some adjusting to do on Thursday as their estimate last month was 124.0 M T. Looking ahead to Thursday’s Supply-Demand update – I’m looking for a slight hike in the old crop carryout due to declining exports and only a minor offset from a slightly higher crush. This hike will transition over to the new crop in the form of a higher carryin. It’s interesting to note that trade guesses are calling for a slight decline in the old crop carryout while increasing the new crop carryout. The USDA should leave new crop acreage and yield unchanged vs. last month.
The interior soybean basis reads steady to easier. The easier locations are on the interior rivers. The gulf appears easier at it midday posting. Nearby spreads ran unchanged on the day but I couldn’t help but notice the flat price losses in the spring and summer months of 2021. Offers to sell cash soybean meal run unchanged for both domestic and export. Meal spreads were steady up front while flat price losses were noted in the spring and summer months of 2021.
As I mentioned earlier soybeans and soybean meal are experiencing some backing and filling of last week’s rally. The best looking support for July soybeans is close to the $8.50 level. If July meal is any good it should catch hold against $285.0-$284.0. July soybean oil stays strong looking with some outside potential to fill its gap against the $28.90 level (personally I would not trade in anticipation of this).
Daily Support & Resistance – 6/10
July Soybeans: $8.57 – $8.75
July Soy Meal: $285.0 – $290.0
July Bean Oil: $27.75 – $28.60
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.