Soybeans Commentary


Soybeans – Just My Opinion

August Soybeans closed 4 cents lower ($14.01 ½), Sept unchanged ($13.47)  & Nov 1 cent higher ($13.41)

August Soybean Meal closed unchanged ($355.4), Sept $1.3 higher ($355.2)  & Dec $2.0 higher ($358.5)

August Soybean Oil closed 2 pts lower ($63.51), Sept 3 pts higher ($62.25) & Dec 2 pts lower ($61.58)

Weekly Soybean Export Sales – 97.0 K T. old crop vs. -100 + 100 K T. expected – 1.120 M T. new crop vs. 500-900 K T. expected

Weekly Soybean Meal Export Sales – 116.3 K T. old crop vs. 50-250 K T. expected – 268.3 K T. new crop vs. 0-100 K T. expected

Weekly Soybean Oil Export Sales – 0.4 K T. old crop vs. 0-20 K T. expected – no new crop vs. none expected

USDA announces Soybean Export Sales – 132.0 K T. to China; 198 K T. to unknown– brings 6-day total to 1.259 M T.

Highlights of USDA Soybean Production/Supply-Demand ReportUS old crop – cut crush by 15 M bu., cut exports by 10 M bu., increased carryout by 25 M bu. – US new crop – increased carryin by 25 M bu., lowered yield 0.8 bpa, lowered production 66 M bu., cut crush by 20 M bu., cut exports by 20 M bu., left carryout unchanged – S-T-U now 3.5% vs. 3.5% last month vs. 3.5% last season – World – increased new crop carryin by 1.33 M T., lowered production by 1.59 M T., lowered total usage 2.5 M T., increased carryout 1.66 M T.

That was quite a knee-jerk reaction for what I thought was mostly a neutral report. Prior to the numbers Nov beans were trading about 15 cents lower and then rallied some 40 cents and then finally breaking back to near unchanged. Both product markets saw similar price action. It is my opinion that the soybean market was under pressure prior to the report from weather considerations. Current weather and forecasts suggest we’re making soybeans. It is my idea that on subsequent production reports we will see gradual increases in yield from the current rain as well as from the forecasts for more. As far as I’m concerned this is the reason the complex could not sustain the post report rally.

As of this writing I’m thinking Nov beans should test the $13.00 level if not something closer to $12.50. I doubt we go any lower than $12.50 as we have to maintain some risk for the upcoming Brazilian crop. For what it is worth a dry bias are current conditions in the central areas. I would like to think Dec meal is no better, no worse than a trading affair between $350.0 and $370.0. soybean oil will continue take its cue from the palm market.

Daily Support & Resistance – 08/13

Nov Beans: $13.25  – $13.55

Dec Meal: $350.0 – $364.0

Dec Soy Oil: $60.00 – $63.00

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