Nov Soybeans closed 20 cents higher ($10.79), March 22 cents higher ($10.79 ¾) & July 19 ¼ cents higher ($10.73)
December Soybean Meal closed $8.5 higher ($385.7), March $7.0 higher ($369.0) & July $6.6 higher ($358.7)
December Soybean Oil closed 61 pts higher ($34.39), March 67 pts higher ($34.13) & July 64 pts higher ($33.99)
Weekly Soybean Export Sales – old crop vs. 800 K – 1.700 M T. expected – new crop vs. none expected
Weekly Soybean Meal Export Sales – old crop vs. 175-400 K T. expected – new crop vs. none expected
Weekly Soybean Oil Export Sales – old crop vs. 5-30 K T. expected – new crop vs. none expected
January soybeans come within a half cent of its recent high; $10.88 today vs. $10.88 ½ on October 27th. Both product markets continue to retrace higher. The weather in SA remains suspect due to rains not materializing as previously forecast. Southern Brazil and Argentina both remain quite dry with little moisture in their respective forecasts for these areas. Adding to the day’s rally was a “risk-on” attitude citing the surging equity markets as well as the lower US Dollar. The unfavorable weather in SA is the biggest feature considering Brazilian producers have sold so much of their potential crop before it’s in the ground. Remember that a La Nina weather scenario had been predicted for the areas of concern and so far it is coming to fruition.
The interior soybean basis trades all over the place. It was just a couple of days ago Illinois River locations were getting blasted and now they are trying to stabilize with some slight firming. The Gulf basis continues to ease at its midday posting. I have to wonder if the Gulf is loading at capacity given out front end loaded export program; meaning no room for more at this time. Nov loses to Jan while Jan and March gain on their deferreds. The interior meal basis appears to be softening as is the Gulf. Meal spreads, however, continue to firm.
The price action throughout the soybean complex is nothing short of impressive. In addition to the developing weather woes in SA the trade appears to be anticipating a bullishly construed report from the USDA next Tuesday. Until we see better weather in the areas of concern in SA I have to think the soy complex will remain well supported when short term ideas of overbought prompt corrections.
Daily Support & Resistance – 11/05
Jan Beans: $10.70 – $10.95 (?)
Dec Bn Meal: $380.0 – $391.0
Dec Bn Oil: $33.80 – $34.80
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.