Jan Soybeans closed 4 ½ cents lower ($11.58 ½), March 2 ½ cents lower ($11.62 ½) & July ¾ cent higher ($11.61 ½)
December Soybean Meal closed $2.3 lower ($386.5), March $1.0 lower ($382.9) & July $0.9 higher ($380.3)
December Soybean Oil closed 32 pts lower ($38.87), March 38 pts lower ($37.85) & July 18 pts lower ($37.48)
Weekly Soybean Export Inspections – 2.297 M T. vs. 1.500-2.200 M T. expected
Welcome to the Wonderful World of Volatility!!! – During the Sunday night session soybeans traded as much as 14 cents lower. During the day session they traded as much as 7 cents higher. The downside rationale was the idea of better weather developing for the SA soybean crop as well as the latest COT report suggesting further spec liquidation. There continues to be additional talk of previously established soybean contracts being traded out of by the Chinese. The rally out of the hole had some technical considerations; soybeans held last week’s lows as well as the idea we’ll see another cut to the projected soybean carryout on Thursday. Weekly export inspections were nothing short of solid which helped the mid-morning rally. The news wires’ surveys are suggesting the soybean carryout could decline another 21-22 million bu. There is also talk that the rally in the Brazilian real may be cutting into their competitiveness for the late January, February timeframes. The bottomline to all of this is that the nearby soybean contracts finished modestly lower on the day.
Not much happens with the interior soybean basis. This holds true for the Gulf as well. The nearby soybean spread was under the gun today as Jan loses 2 cents to the March and 4 cents to the May. Some of the rationale for this can be attributed to today being the first day of the big boy index fund role. The March forward spreads were also under the gun especially the old crop vs. the new crop. This spread action is in keeping with the idea of general spec liquidation. The Jan forward meal spreads mirrored the soybean spreads.
Despite today’s 20 cent rally from the overnight lows soybean charts still appear to have a defensive posture. Soybean meal charts look the same way. Soybean oil charts appear to be more about consolidation vs. a bearish look.
Daily Support & Resistance – 12/08
Jan Beans: $11.48 – $11.68
Jan Soy Meal: $375.0 – $388.0
Jan Soy Oil: $37.50 – $38.50
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.