Soybeans Commentary


Soybeans – Just My Opinion

Sept Soybeans expired 13 ¾ cents higher ($10.19 ¼), Nov closed 3 ½ cents higher ($9.99 ½) & March 5 ¼ cents higher ($10.02)

Sept Soybean Meal expired $2.2 lower ($316.2), Dec closed $2.6 lower ($322.0) & March $1.5 lower ($324.2)

Sept Soybean Oil expired 54 pts higher ($33.13), Dec closed 58 pts higher ($34.29) & March 55 pts higher ($34.52)

USDA announces Soybean Export Sales – 129 K T. sold to China – 318 K T. sold to unknown

Weekly Soybean Export Inspections – 1.283 M T. vs. 800 K – 1.500 M T. expected

Weekly US Soybean Crop Ratings & Progress – 63% GE (-2%) vs. 65% expected vs. 54% year ago – Dropping Leaves – 37% vs. 31% 5-year average

Weekly export inspections come in near the high end of expectations. The trade remains puzzled as to why the USDA did not hike US export demand given recent Chinese buying. The latest FSA acreage report suggests maybe a minor cut to harvested acres. As far as yield is concerned harvest will dictate if further changes are needed. Cash markets are firm similar to corn as the new marketing year for soybeans is front end loaded for exports. The highs of the day came early in the Sunday night session and were never really challenged as the day went on. Soybean oil was your leader in the product markets as competing veg oils remain quite strong. Inter-market spreading weighed on the meal market.

For what it is worth – Planting season in Brazil has started with a dry bias. Longer term forecasts are suggesting better moisture will begin by month’s end. It is imperative that Brazil has a successful growing season since it has been reported that the Brazilian producer has already sold nearly half of what he expects to produce.

As I mentioned cash markets remain strong. Crushers are competing with export originators for product. Harvest is still a few weeks away but exporters need soybeans now. Soybean spreads, however, were putting carry back into the price structure. I think this is a result of the export market being front end loaded meaning exports should fade once the new crop comes online from Brazil usually by late January, early February.

November soybeans trade above $10.00 but were unable to sustain the rally going into the close. Granted we still closed higher on the day the failure to close above $10.00 has to be a bit disappointing. From a technical point of view the soybean market has a decent degree of overbought. Soybean meal solved some of its overbought with today’s easier price action. Soybean oil jumps up and out of its recent 2 week period of consolidation.  December bean oil is now looking at something between $35.00 and $35.25. If this strength is realized it will lend some indirect support to the soybean market. In other words the soybean market could ease from recent highs but not top out.

Daily Support & Resistance – 9/15

Nov Soybeans: $9.82 – $10.10

Dec Bean Meal: $317.0 – $326.0

Dec Bean Oil: $33.75 – $34.70 

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