Soybeans Commentary


Soybeans – Just My Opinion

July Soybeans closed 16 cents higher ($9.12 ¾), August 16 ¼ cents higher ($9.19 ¼) & Nov 16 cents higher ($9.39 ½)

July Soybean Meal closed $0.8 higher ($324.3), August $1.0 higher ($325.7) & Dec $1.1 higher ($333.0)

July Soybean Oil closed 53 pts higher ($28.14), August 51 pts higher ($28.28) & Dec 46 pts higher ($28.79)

Weekly Soybean Export Inspections – 675.3 K T. vs. 500 K – 1.000 M T. expected

Weekly Soybean Crop Progress – Planted – 77% vs. 79% expected vs. 93% 5-year average – Emerged – 55% vs. 84% 5-year average

The corn rally came from the idea of lost acres due to excessive water in all of the Corn Belt, especially east. In recent days the eastern Corn Belt has stayed wet and forecasts suggest that will continue for the next week or so. The western Corn Belt has been without some of these recent big rains. I have to think the western Corn Belt has made some decent inroads with their soybean planting while the eastern areas are now thinking if they will be able to get a soybean crop planted at all. It’s this possible loss of soybean acres that has prompted some of the recent short covering. Given the old crop carryout projections we could probably afford to lose some new crop acres but as long as this idea of lost acres persists it will provide some underlying support to the soybean market.

Interior soybean basis reads steady to higher with the greatest strength in the east where planting is having the greatest problems. The gulf was moving higher into late last week; the midday posting saw those gains trimmed. Board crush margins took a noticeable hit on Monday. Monthly NOPA crush data came in weaker than expected. Weekly export inspections were nothing to write home about. Soybean spreads were fractionally mixed out to November and then bull spreading took over. The bull spreading, November forward, is a result of the flat price short covering. Offers to sell cash meal in the interior run mostly steady. Basis offers remain nothing special. Offers at the Gulf continue to edge higher as do most offers for anything at the Gulf. Meal spreads ran steady to fractionally softer out to January.

The funds/specs continue to cover shorts in the soybean market. This is the only market where there is still a noticeable/sizable net short spec/fund position. Given where we are in respect to the technical overhead resistance it is my thought further advances may not come as easily as we have seen over the past few days. Bean oil leads soybean meal; that is not friendly. Soybean oil influence may keep the soybean market alive but it is not known to further sharp advances. July soybean meal needs to get above $330.0 with conviction if it wants to help the soybean market show further advances.

Daily Support & Resistance for 06/18

July Soybeans: $8.95 – $9.20

July Soybean Meal: $318.0 – $330.0

July Soybean Oil: $27.70 – $28.65

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.