Soybeans Commentary


Soybeans – Just My Opinion

August Soybeans closed 5 ¼ cents lower ($8.82 ½), Sept 5 ½ cents lower ($8.88 ¼) & Nov 5 ½ cents lower ($9.00 ½)

August Soybean Meal closed $0.9 lower ($307.5), Sept $0.9 lower ($309.0) & Dec $1.2 lower ($313.6)

August Soybean Oil closed 31 pts lower ($27.68), Sept 32 pts lower ($27.79) & Dec 35 pts lower ($28.11)

Weekly Soybean Export Sales – old crop vs. 0-400 K T. expected – new crop vs. 100-300 K T. expected

Weekly Soybean Meal Export Sales – old crop vs. 50-200 K T. expected – new crop vs. 0-100 K T. expected

Weekly Soybean Oil Export Sales – old crop vs. 5-45 K T. expected – new crop vs. 0-5 K T. expected

Funds continue to be in a liquidation mode. The inability of rally attempts to sustain themselves prompts the continued selling. Recent weather is deemed beneficial for plant development. Renewed tariff threats due to a lack of Chinese buying acts as a detriment as well. Renewed questions around acres will only provide brief moments of support until something more substantial is known or at least believed. Traders have to realize fund managers are technical traders and the “funds” dominate the majority of the day to day trading. If the price action shows a bias one way or the other the funds will trade in the direction the bias is going.

The recent break in futures has shut down any pending cash movement that we may have seen prior to the recent break. With that said interior basis levels run steady with a slight bias higher. The Gulf, however, is sliding due to easing logistics as well as mediocre demand at best. Soybean spreads had a fractional bullish bias out to January but it went downhill after that. Offers to sell cash meal are mostly steady as dealers tout a tight supply but with slack demand. Meal spreads showed fractional improvement out to December but not much after that.

$8.90 is showing up as a pivot point for November soybeans. Closes below that level with conviction will suggest a technical move down towards $8.80. Failure at that level will suggest another 20 cents down. As of this writing I’m not looking past the $8.80 level. The price action in August soybean meal is just as shaky looking but support comes in at a much higher level. Closes below $304.0 will suggest something closer to $300.0-$298.0. August soybean oil had been in a solid looking up channel up until today. Today’s break is suggesting something closer to $27.00 especially if $27.50 is taken out on a closing basis.

Daily Support & Resistance for 07/18

Aug Soybeans: $8.71 – $8.95

Nov Soybeans: $8.90 – $9.14

Aug Soybean Meal: $304.0 – $311.0

August Soybean Oil: $27.50 – $28.00

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.