Soybeans Commentary


Soybeans – Just My Opinion

August Soybeans closed 1 cent higher ($8.48 ¾), Sept 1 cent higher ($8.54) & Nov 1 cent higher ($8.66 ¾)

August Soybean Meal closed $2.1 lower ($293.0), Sept $2.3 lower ($295.0) & Dec $2.6 lower ($300.0)

August Soybean Oil closed 48 pts higher ($27.96), Sept 45 pts higher ($28.01) & Dec 44 pts higher ($28.37)

USDA announces 165.0 K T. of new crop soybeans sold to unknown

Reuters Survey Results for August 12th – Planted Acres 81.006 million – Yield 47.6 – Production 3.8.00 billion bu. – New Crop Carryout 821 million bu. – Old Crop Carryout – 1.065 billion bu.

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

Weekly Soybean Meal Export Sales – old crop vs. 50-200 K T. expected – new crop vs. 25-125 K T. expected

Weekly Soybean Oil Export Sales – old crop vs. 5-20 K T. expected – new crop vs. 0-10 K T. expected

Not much of a trade in the flat price of soybeans on Wednesday; just a 7 to 7 ½ cent range. The inter-market spread, meal vs. bean oil, had a bit of a reversal of what we’ve seen over the past two days. Soybean meal gave up its leadership role as it gave back about $500 of the $700 it had gained. There is still concern over the dry areas of the Midwest but in my experience the soybean plant will try as long as it can to wait for the beneficial moisture. Forecasts are at best mixed as the American model talks about moisture while the European model not so much. Yes, we may have a short crop but as long as we don’t have any Chinese business we are going to have short demand (offsetting issues).

Interior cash soybean markets continue to be pretty quiet as movement is slow but so is demand. Soybean spreads ran unchanged all the way out to May. Interior offers for meal appear to be easier; export offers unchanged. Meal spreads showed a bullish bias out to December but then turned bearish January forward.

After Monday’s suggested interim reversal we have spent the next two days trading inside of that range. I have to think the trade is waiting to see what the USDA has to say on Monday the 12th. The Nov soybean chart shows room to rally but runs into a brick wall starting at the $9.00 level. The soybean meal market appears to be biding its time while the bean oil market remains range bound. For those of you that feel compelled to trade every day try not to get caught chasing short term extremes.

Daily Support & Resistance for 08/08

Nov Soybeans: $8.60 – $8.75

Dec Soybean Meal: $298.0 – $305.5

Dec Soybean Oil: $27.95 – $28.60

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.