July Soybeans closed 6 ½ cents higher ($8.28 ½), August 6 ¾ cents higher ($8.35 ½) & Nov 6 ¾ cents lower ($8.55 ¼)
July Soybean Meal closed $3.0 higher ($298.3), August $3.0 higher ($299.9) & Dec $2.8 higher ($306.4)
July Soybean Oil closed 17 pts higher ($27.31), August 17 pts higher ($27.43) & Dec 17 pts higher ($28.01)
USDA announces 131.0 K T. of soybeans sold to unknown – 110.0 K T. old crop, 21.0 K T. new crop
Weekly Soybean Export Sales – old crop 0-400 K T. expected new crop vs. 100-400 K T. expected
Weekly Soybean Meal Export Sales – old crop vs. 50-300 K T. expected – new crop vs. 25-100 K T. expected
Weekly Soybean Oil Export Sales – old crop vs. 4-25 K T. expected – new crop vs. none expected
Cooler heads prevailed in the soybean complex following yesterday’s sharp downward reaction to the suggested Market Facilitation Payments (MFP) of $2.00 per bushel to the US soybean farmer. Initially it was thought this payment would be based on this year’s producers’ acreage and his average yields. Overnight the thought then became it would involve average acreage history over the past 3 or 5 years and average yields over those past years. As of this writing we still don’t know the details of the MFP; hopefully we’ll know sooner vs. later. With that said the soybean market is maintaining the consolidation phase it entered into 5 days ago following the initial 3 day rally that started on Monday, May 13th.
The interior soybean basis is nowhere near as erratic as the interior corn basis but it is not without a few changes. The Ohio River is strong despite a 1 cent easing, Toledo firms 5 cents following yesterday’s 5 cent easing and Seneca, IL is 2 cents easier. The Gulf had a noticeable jump Tuesday night and it appears it was given back today. Only a couple of fractional changes were seen in the soybean spreads today. Offers to sell cash soybean meal are firming, both in the interior and for export. Meal spreads ran steady to better on the day reflecting the higher cash offers.
Despite what appears as bearish fundamentals the recent 5-day action in the soybeans has the resemblance of a downflag especially when one looks at a “close only” chart. The soybean meal charts have a similar look as do soybean oil charts. The only bullish fundamental rationale that I can come up is that it keeps raining well into June and/or we come to some sort of an accord with China (I’m not holding my breath on the latter). A long time ago my father said charts will turn before we hear about the story behind the turn.
Daily Support & Resistance for 05/23
July Soybeans: $8.15 ($8.05) – $8.45
July Soybean Meal: $294.0 – $305.0
July Soybean Oil: $26.75 – $27.75
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