November Soybeans closed 22 ¼ cents lower ($12.09 ¼), Jan 21 ½ cents lower ($12.22 ¾) & March 21 cents lower ($12.34 ¼)
December Soybean Meal closed $5.0 lower ($335.8), Jan $4.5 lower ($332.7) & March $3.9 lower ($332.8)
December Soybean Oil closed 145 pts lower ($59.58), Jan 125 pts lower ($59.49) & March 98 pts lower ($59.09)
Weekly Soybean Export Sales – 1.863 M T. old crop vs. 1.000-2.000 M T. expected – no new crop vs. 0-20 K T. expected
Weekly Soybean Meal Export Sales – 226.6 K T. old crop vs. 100-250 K T. expected – -0.2 K T. new crop vs. 0-30 K T. expected
Weekly Soybean Oil Export Sales – 11.2 K T. old crop vs. 0-20 K T. expected – no new crop vs. 0-10 K T. expected
The soybean complex comes unglued on Thursday. I thought week export sales were decent vs. expectations. Unfortunately the soybean oil market takes it on the chin due to another day of declining energy prices. Soybean meal caught some profit taking of its recent rally after it failed to move beyond recent highs. January soybeans have broken 45 cents from Tuesday’s high to today’s low. A resumption of harvest and competitive prices from Brazil has undermined the recent rally. I’m told it’s unusual for Brazilian soybean prices to be competitive with US prices for this time frame. Blame it on the higher US Dollar and the big crop they had last year. So far I’m not seeing any issues with the early stages of the Brazilian growing season.
Interior soybean basis levels run steady to easier. The gulf is mostly steady at its midday posting. Soybean spreads continue to leak wider suggesting supply is outstripping demand. Crush margins eased in response to the lower product markets.
I’m a bit surprised at the magnitude of today’s break. It suggests the supply of soybeans is far outweighing the demand. It further suggests the possibility for a healthy increase in our projected carryout in the upcoming production/supply demand report from the USDA next Tuesday. Right now the average trade guess for carryout is suggesting a 42 M bu. increase. Given our current rate of crush and exports many are thinking it wouldn’t take much to see a carryout approach the 400 M bu. mark. Given today’s sharp sell off a challenge of the October low is going to happen sooner vs. later.
Daily Support & in Resistance – 11/05
Jan Beans: $12.35 – $12.55
Dec Meal: $334.0 – $344.0
Dec Soy Oil: $60.00 – $62.00
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