Soybeans Commentary


Soybeans – Just My Opinion

August Soybeans closed 2 ½ cents higher ($8.85 ¾), Sept 2 ¾ cents higher ($8.91 ½) & Nov 3 ¼ cents higher ($9.04 ¼)

August Soybean Meal closed $1.1 higher ($304.2), Sept $1.4 higher ($306.3) & Dec $1.8 higher ($311.5)

August Soybean Oil closed 4 pts lower ($28.43), Sept 4 pts lower ($28.59) & Dec 5 pts lower ($28.97)

Weekly Soybean Export Inspections – 1.031 M T. vs. 400-800 K T. expected

Weekly Soybean Condition & Progress – 54% GE vs. 54% expected vs. 70% year ago – Blooming – 57% vs. 79% 5-year average – Setting Pods – 21% vs. 45% 5-year average

Soybeans catch a minor bid ahead of the scheduled US/China trade talks that begin tomorrow in Shanghai. Concerns over crop development lent some minor support as did the weekly soybean export inspections. Over the weekend China tried to say they have bought “millions of tons of US grain” as a good faith measure. Yes, a good portion of today’s export inspections went to China but these have been from much older purchase agreements. Since the late June summit Chinese purchases have been minimal based on USDA data. Given poor Chinese crush margins it doesn’t make a lot of sense for them to be making large purchases at this time. Additionally; both Brazil and Argentine represent cheaper origins.

Basis levels for soybeans along the inland waterways are dropping. The midday posting for the Gulf was off 16 cents from what we saw on Thursday. Processor basis levels are running unchanged as Board crush margins continue to be sideways as they have for the majority of the month of July. Soybean spreads had a fractional bearish bias to them as did meal spreads. This Wednesday is first notice day for August soybeans and their respective products.

Waiting for Godot, I mean China. China keeps talking about good faith purchases, asking for offers. To date I’ve seen nothing new. Crop conditions probably play as big a role in near term direction. The overall trend for soybeans continues to be sideways featuring lower highs and higher lows. Dec meal filled it Memorial Day weekend gap and so far is holding a couple of dollars above that gap. As I mentioned earlier the soybean and soybean meal markets remain in a “wait and see”.

Daily Support & Resistance for 07/30

Nov Soybeans: $8.95 ($8.90) – $9.15

Dec Soybean Meal: $308.0 ($306.0) – $314.0

Dec Soybean Oil: $28.50 – $29.10

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.