March Soybeans closed 10 ½ cents lower ($13.54 ¾), July 11 ¼ cents lower ($13.33 ¾) & Nov 3 ½ cents lower (11.50 ½)
March Soybean Meal $2.5 lower ($428.0), July closed $2.4 lower ($420.6) & Dec $0.9 higher ($366.5)
March Soybean Oil closed 65 pts lower ($44.32), July closed 51 pts lower ($42.99) & Dec 38 pts lower ($40.10)
We continue to see a fair amount of intra-day volatility in the soybean market. If one looks at the closes over the past 6 days we really haven’t gone anywhere as the range has been just 27 cents. Weather in SA has improved some over the past number of days. It seems some of the harvest ready areas of Brazil have been drying out while areas further south that are still in their final development stages are receiving beneficial moisture. Recent weather in Argentine has been deemed beneficial. There has been some talk that China may be washing out some Brazilian trades with a March timeline due to poor crush margins. I personally am not expecting to see a large old crop sales report on Thursday as it seems the recent focus has been for the new crop. Next Tuesday the USDA will update the US carryout and most are expecting another drop. This should provide support on any sharp intra-day breaks between now and then.
The interior Midwestern soybean basis has a mixed look to it. River locations appear to have stabilized vs. recent weakness. Processors remain fully steady. The Gulf basis for soybeans edges higher. March beans gain on My and July while the May forward spreads were all bearish looking. Offers to sell cash meal for both the interior and for export have a soft look. Meal spreads were flat up front but bearish looking vs. the new crop. The recent bearishness in the old crop spreads, bean oil included, suggest some overall passive spec liquidation.
The recent price action (consolidation) throughout the complex suggests the flat price is vulnerable to some near term liquidation. As I’ve mentioned before any sharp intra-day breaks will be well received. Longer term ideas still suggest the need for price rationing especially if the carryout continues to be drawn down.
Daily Support & Resistance – 02/03
March Beans : $13.35 – $13.72
March Meal: $420.0 – $436.0
March Bean Oil: $43.50 – $45.00
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.