Soybeans Commentary


Soybeans – Just My Opinion

Jan Soybeans closed 5 ½ cents higher ($11.53 ½), March 6 ½ cents higher ($11.54 ½) & July 6 ½ cents higher ($11.48 ½)

December Soybean Meal closed $1.2 higher ($389.3), March $2.1 higher ($386.3) & July $1.1 higher ($379.2)

December Soybean Oil closed 30 pts higher ($37.43), March 33 pts higher ($37.02) & July 31 pts higher ($36.43)

Weekly Soybean Export Inspections – 2.239 M T. vs. 1.400-2.500 M T. expected

NOPA October Crush – 185.245 million bu. vs. 177.123 expected – I’m told this is an all-time record monthly crush for NOPA members

Weekly Soybean Crop Progress – Harvested – 96% vs. 96% expected vs. 93% 5-year average

Reports of scattered moisture in SA over the weekend had the soybean complex starting the day session with an easier bias. The night session featured a two-sided trade as well.  The inability to sustain the attempt to sell off the entire complex went firm for the balance of the day. NOPA reported an all-time high monthly crush for October. Couple this strong rate of crush with excellent weekly export inspections the willingness to sell the market faded. Prices didn’t really run away on the upside but the ability to stay firm for the last half of the session acted as a reminder the higher trend remains firmly intact. Brail is seeing scattered moisture but nothing general. Argentina continues to see a dry bias. Forecasters continue to suggest better rains may be on the way for central Brail while its southern areas and Argentine will continue to see a drier than normal trend.

The latest Commitment of Traders report suggests that from 11/04 to 11/10 large speculators added to their new long soybean position by 13,700 contracts and the managed sector added 10,137 contracts. This has to be viewed as lighter than expected considering Jan soybeans rallied 82 cents in the same time frame. Soybean open interest saw little change during this time frame.

The interior soybean processor still has the best basis out there. This makes sense considering the record NOPA crush data for October. The recently beaten down river basis is stabilizing; rebounding at some locations. The Gulf basis appears to be stabilizing after last week’s beating. Nearby soybean spreads are soft out to May then May forward bull spreads take over. Meal spreads have a similar look; soft up front then mixed as one goes forward.

The soybean trade has gone quiet at its recent upper end. That all by itself spooks me. Soybean oil continues to grind into new highs with the emphasis on the “grind”. Soybean meal is honoring first level minor support after last week’s selloff but that’s about all. I’m not seeing a whole lot of “rejection” of this minor support level. Going forward we will continue to monitor daily demand data (USDA sales announcements) as well as SA weather.

Daily Support & Resistance – 11/17

Jan Soybeans: $11.45 – $11.64

Jan Soy Meal: $385.0 – $395.0

Jan Soy Oil: $36.75 – ???

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