Soybeans Commentary


Soybeans – Just My Opinion

July Soybeans closed 1 cent lower ($8.68 ¾), August 1 cent lower ($8.75 ¼) & Nov 2 cents lower ($8.95 ¼)

July Soybean Meal closed $1.8 lower ($315.9), August $2.1 lower ($317.1) & Dec $2.5 lower ($323.8)

July Soybean Oil closed 54 pts higher ($27.76), August 52 pts higher ($27.89) & Dec 47 pts lower ($28.35)

Weekly Soybean Export Sales – 510.0 K T. old crop vs. 200-500 K T. expected – 73.7 K T. new crop vs. 50-250 K T. expected

Weekly Soybean Meal Export Sales – 110.8 K T. old crop vs. 100-250 K T. expected – 2.1 K T. new crop vs. 0-100 K T. expected

Weekly Soybean Oil Export Sales – 15.4 K T. old crop vs. 8-25 K T. expected – no new crop vs. none expected

It was a decent looking old crop soybean sales number but then again we are not really trading demand. The idea that soybean planters are rolling in many areas kept the soybean and soybean meal markets under wraps on Thursday. Additionally; inter-market spreading, buying feedgrains/selling oilseeds, weighed on the flat price. Short term forecasts suggest the northern half of the Midwest should have decent conditions for planting through the upcoming weekend. Bean oil had a nice performance as traders were unwinding long meal/short bean oil spreads. It should be known that bean oil demand (mostly bio-diesel) is the best we have seen in some time but more times than not bean oil falls to the whims of the palm oil market.

The Ohio River continues to increase its soybean basis as it feeds into the Mississippi River below the snarl at St. Louis; now up 6 cents on the week. Illinois processors are also staying with a firm basis as crush margins continue to stay stout. Basis levels elsewhere in the interior ran unchanged on the day. The Gulf continues to edge higher due to the problems further upriver. On the day soybean spreads had slight bullish bias as did meal spreads despite the easier prices.

July soybeans filled its May 24th to May 28th gap and managed to bounce back to just marginally higher on the day. Unfortunately higher prices were not sustained. November soybeans filled its gap exactly at $8.84 ½. Like the old crop the ensuing bounce was unable to sustain itself on the plus side of the day. As far as I’m concerned the soybean market has not negated the suggested sell signal that was registered on Wednesday. Soybean meal sees similar price action; fills the gap that was created over the Memorial Day weekend but unable to sustain higher prices on the day from the ensuing bounce. Bean oil has been channeling higher since mid-March. The support line of the channel had a brief violation but was able to quickly recover. If you’re bearish the soybean and soybean meal markets being long bean oil against those shorts may not be a bad idea as those inter-market spread charts have a bearish look to them. Soybean meal losing to bean oil is not considered long term friendly to soybeans as whatever rally soybeans can get from bean oil are usually selling opportunities.

Daily Support & Resistance for 06/07

July Soybeans: $8.55 – $8.79

July Soybean Meal: $310.0 – $320.0

July Soybean Oil: $27.30 – $28.10

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.