Soybeans Commentary

storck

Soybeans – Just My Opinion

January Soybeans closed 11 ¾ cents lower ($12.41 ½), March 11 cents lower ($12.52) & May 11 ¼ cents lower ($12.61 ¼)

December Soybean Meal closed $8.5 lower ($347.7), Jan $6.7 lower ($342.7) & March $5.2 lower ($341.4)

December Soybean Oil closed 76 pts lower ($58.26), Jan 60 pts lower ($58.28) & March 48 pts lower ($58.16)

Weekly Soybean Export Inspections – 2.142 M T. vs. 1.000-2.000 M T. expected

After trying to rally with the rest of the crowd (outside markets) Sunday night the soybean complex gave up the ship during the day Monday. Despite some solid looking weekly export inspections the sell-off occurs from the idea that current SA weather is leading to a rather large crop. Come January (if the current weather patterns hold on) Brazil should have enough soybeans available for export that will literally drown out any US demand. Adding to the day’s selling were month end considerations as well as respect for 1st notice day in the product markets. The overall strength in the US Dollar continues to function as an obstacle January forward.

Interior soybean basis levels hold steady with recent firmness. The gulf continues to grind higher. Despite the strong looking basis levels the complex’s spreads fell victim to the month end selling. Overall soybean spreads haven’t been much to write home about while meal spreads have. Both meal and bean oil spreads were under the gun today. Board crush margins also suffered noticeable losses.

The technical look at January soybeans is almost scary bearish. The Sunday night rally filled the gap that was created on Friday’s break and then prices failed miserably. January soybean oil saw comparable price action; filled Friday’s breakdown gap and then failed. For a while there it looked soybean meal was going to totally reverse Friday’s losses and then some before it too fell apart. In recent weeks both processor and export demand has been quite good. That is expected to change on the export front sooner vs. later. If today’s break in the Board crush margins is a harbinger of things to come the processor will too start backing off. Unless the weather turns sour in SA I don’t have too many good things to say about the soybean complex going forward other than to sell rallies.

Daily Support & in Resistance – 11/30

Jan Beans: $12.30 – $12.54

Jan Meal: $339.0 – $348.5

Jan Soy Oil: $57.50 – $59.50

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