March Soybeans closed 21 ½ cents higher ($14.14), July 17 ¾ cents higher ($13.98 ¾) & Nov 10 ½ cents higher (12.29 ¾)
March Soybean Meal closed $3.1 higher ($423.3), July $3.9 higher ($420.0) & Dec $2.8 higher ($380.6)
March Soybean Oil closed 50 pts higher ($51.27), July 45 pts higher ($48.69) & Dec 26 pts higher ($44.21)
In the Monday night trade soybeans, soybean meal and soybean oil test suspected interim support levels and they hold which in turns leads to technical buying. That buying goes along with the weather concerns for Brazil (slow wet harvest leading to possible quality issues as well as delayed availability) that could lead to an extended export season for the US as well as the dryer pattern for Argentina. Adding to this is the idea is that the US crush is not slowing down. With the soybean S-T-U so tight we need to slow down the demand. That may be happening with exports but so far there is no sign of that happening with the crush.
Soybean processors continue to stand in with their basis. River locations for soybeans read mixed. The midday posting at the Gulf is steady with its recent softness. Despite what appears as a softer looking gulf basis bull spreads in the futures market were working noticeably not only against the new crop but also within the current crop year. As I mentioned earlier we may be slowing exports but we’re not slowing the rate of crush. Offers to sell cash meal in the domestic market are steady to a shade better while maintaining recent softness at the gulf. Meal spreads were soft upfront. July forward meal spreads showed a tightening bias.
May soybeans test the recent established interim support level, $13.80 and it holds. May soybean meal challenges the low end of its 6 week old trading range and it holds. Not to be left out May soybean oil tests its recently established interim support and it too holds. This technical feature opened the door for renewed buying. The tightness in the old crop soybean market is not going to go away anytime soon. With that said any challenge of suspected support holding will lead to another round of buying. It remains my opinion the meal market is the key here. As long as it holds the soybean market will hold. If soybean meal can give us an upside breakout of its trading range soybeans will tack on another leg higher. Worst case scenario for the near term – soybean meal will maintain its weeks old trading range and soybeans will trade between $13.75 and $14.50 (May)
Daily Support & Resistance – 03/03
May Beans : $14.00 – $14.35
May Meal: $416.0 – $430.0
May Bean Oil: $49.00 – $50.25
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.