Soybeans Commentary

storck

Soybeans – Just My Opinion

Jan Soybeans closed 12 ¾ cents higher ($11.58 ½), March 12 cents higher ($11.63 ½) & July 11 cents higher ($11.63)

December Soybean Meal closed $2.7 higher ($384.4), March $2.6 higher ($381.4) & July $2.4 higher ($380.3)

December Soybean Oil closed 48 pts higher ($38.76), March 43 pts higher ($37.72) & July 37 pts higher ($37.36)

Weekly Soybean Export Sales – old crop vs. 400-800 K T. expected – new crop vs. 0-250 K T. expected

Weekly Soybean Meal Export Sales – old crop vs. 100-300 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

Anticipation of a bullish looking Supply-Demand from the USDA tomorrow was pretty much the rationale behind today’s rally. Adding to the upside are ideas CONAB will give us a lower soybean production figure for Brazil. Weather for now is okay in Brazil. Mato Grosso is getting decent rains while the south has a dry bias. This scenario is expected to shift next week. Weekly export sales are out in the morning and based on expectations the trade is realizing the recent trend of lower sales.

Not much happens with the interior soybean basis. If there are any changes they are slightly better as new cash soybean sales from the producer continue to be slow. The Gulf basis for soybeans sees unchanged bids and higher offers at the midday posting. Bull spreads were working in the soybean market. That goes along with the higher flat price. Once again it appears the trade feels the biggest risk is to the upside not to the downside.

Like the corn charts the soybean complex’ charts have moved into a holding pattern. The trade is waiting to see if tomorrow’s data (weekly export sales, CONAB & the USDA) give us new rationale to take prices higher. The mid-low $11.40’s has become the new downside pivot (January). Failure there will suggest a drop down to the $11.10-$11.00 level. Soybean meal charts remain in a more defined down trend. $370.0 looks like the next level of support (Jan) while $390.0 is resistance. Soybean oil charts are more sideways than anything else as they continue to take their cue from the palm market. For the time I’ll continue to view Jan bean oil as a trading affair between $36.50 and $39.00.

Daily Support & Resistance – 12/10

Jan Soybeans: $11.40 (?) – $11.80

Jan Soy Meal: $373.0 – $387.0

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.