Soybeans Commentary


Soybeans – Just My Opinion

Jan Soybeans closed 1 ¾ cents higher ($11.77 ½), March ¾ cent higher ($11.75 ½) & July ½ cent higher ($11.67 ¾)

December Soybean Meal closed $1.2 lower ($393.7), March $1.4 lower ($389.1) & July $0.9 lower ($381.5)

December Soybean Oil closed 35 pts higher ($38.81), March 27 pts higher ($38.13) & July 23 pts higher ($37.46)

Weekly Soybean Export Sales – 1.387 M T. old crop vs. 600 K – 1.200 M T. expected – no new crop vs. none expected

Weekly Soybean Meal Export Sales – 182.0 K T. old crop vs. 100-300 K T. expected – no new crop vs. none expected

Weekly Soybean Oil Export Sales – 45.1 K T. old crop vs. 8-40 K T. expected – no new crop vs. none expected

Soybeans see a two-sided trade on Thursday as it appears they are caught between a continued strong soybean oil market and a soft looking soybean meal market. Based on expectations weekly soybean export sales came in better than expected. The “however” is that these sales were a marketing year low. AS far as the SA weather is concerned not much has changed; scattered rains around for the central and northern areas while the south and Argentina continue with the dry bias.

Interior river locations are seeing a rebound with their respective basis levels. The Gulf appears to be a bit slower in coming back from last week’s sell off. In the spreads Jan gains on March forward and after that spreads ran fractionally mixed. Soybean meal spreads were slightly soft upfront mixed to wider after that. Soybean oil spreads remain strong.

The price action for soybeans suggests nothing bearish to me despite many thinking the market is overbought. I will suggest that if the current scenario of strong bean oil and soft soybean meal the soybean market will stay alive but struggle to sustain further sharp advances similar to what we saw on Wednesday. Soybean meal needs some get up and go and get through the $400.0 level if the soybean market is going sustain any further sharp advances. Recent longs in Jan meal will not want to see closes below the $385.0 level. I’ll admit that bean oil is starting to look a bit lofty but from a pure technical point of view it is only modestly overbought not really extreme. I have to wonder if the bean oil bulls are targeting the $40.00 level. Interesting to note that Egypt passed on a soybean oil tender citing prices as too high. That’s one of functions of high prices; curb demand.

Daily Support & Resistance – 11/20

Jan Beans: $11.65 – $11.90 (?)

Jan Soy Meal: $389.0 ($385.0) – $395.0

Jan Soy Oil: $37.80 – ???

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