Nov Soybeans closed 22 ¾ cents higher ($11.01 ¾), March 18 ¼ cents higher ($10.98) & July 18 cents higher ($10.91)
December Soybean Meal closed $2.1 higher ($387.8), March $3.2 higher ($372.2) & July $3.7 higher ($362.4)
December Soybean Oil closed 108 pts higher ($35.47), March 84 pts higher ($34.97) & July 78 pts higher ($34.77)
Weekly Soybean Export Sales – 1.530 M T. old crop vs. 800 K – 1.700 M T. expected – no new crop vs. none expected
Weekly Soybean Meal Export Sales – 331.5 K T. old crop vs. 175-400 K T. expected – no new crop vs. none expected
Weekly Soybean Oil Export Sales – 6.8 K T. old crop vs. 5-30 K T. expected – no new crop vs. none expected
USDA announces Soybean Oil Export Sales – 33.0 K T. sold to India
Solid export sales, weather fears in SA and a lower US Dollar all worked together to launch the soybean complex to new highs for the current rally prior to some modest profit taking. Adding to this is the anticipation of a bullish report from the USDA next Tuesday. The Reuters survey of traders suggests the projected soybean carryout could decline by 55 million bu. to 230 million. The average national soybean yield is expected to decline by 0.3 bpa to 51.6 bpa leading to a cut in production by 17 million bu. to 4.251 billion. The big difference in production decline vs. carryout decline will be attributed to another hike in usage most probably in export.
Prior to today the interior processor basis had been consistently steady vs. the erratic interior river basis. Today’s flat price rally in both soybeans and soybean meal had all basis levels easing. River locations continue to be erratic; now erratically lower. The Gulf basis at its midday posting continues show some further easing. With the exception of the soon to expire November contract (deliveries have dried up for now) soybean spreads showed some minor widening within the current crop year while old crop continues to gain on the new crop. The infamous July/Nov spread came within 1 ½ cents of trading $1.00 over.
After the highs were made relatively early in the day session we saw some profit taking ensue. It’s my thought the easing in the meal prices were most responsible for the soybean price easing as soybean oil prices stayed strong throughout the session. I’m told the high prices in soybean meal are scaring some domestic users away. Soybean oil gets additional support from competing veg oils (palm, rape, sun) that are making multi year highs (just like soybeans). I’m told China was active last night as well as during the day today. So here we have it – a demand market coupled with a weather market (SA). Keep your seat belts fastened!!!
Daily Support & Resistance – 11/06
Jan Beans: $10.95 – ???
Dec Bn Meal: $384.0 – $395.0
Dec Bn Oil: $34.85 – $36.05
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.