August Soybeans closed 28 ¾ cents higher ($9.03 ¾), Sept 28 cents higher ($9.08 ¾) & Nov 28 cents higher ($9.19)
August Soybean Meal closed $7.3 higher ($341.2), Sept $7.0 higher ($339.9) & Dec $7.7 higher ($341.4)
August Soybean Oil closed 42 pts higher ($28.73), Sept 43 pts higher ($28.89) & Dec 45 pts higher ($29.30)
Hopes that the US and China will soon sit down to hammer out their trade differences coupled with extended forecasts suggesting some of the hottest temps of the season had the soybean market rocketing to levels not seen since mid-late June. Both soybeans meal and soybean oil went along for the ride. Dec meal traded to its best level dating back to mid-June while Dec bean oil continued with its upflagging effort. Bean oil continues to be the laggard within the complex. Most forecasters agree that a “ridge will rebuild over the Corn Belt by early mid-August; differences are just where the center of the ridge will be. Some have it over the western Midwest while others suggest maybe further east. As far as the US and China sitting down to hammer out trade differences is still rather speculative but supposedly there has been some discussion but nothing face to face has occurred. It has been a known fact that China would like to resolve their differences with the US but so far the US hasn’t been all that receptive. The bottom line is that the soybean shorts are on the run.
For the most part interior soybean bids remain on the defensive. The only changes I’m seeing are Savanna, IL improving by 4 cents and Lincoln, NE going basis Nov at a 15 cent spread. Like corn Savanna, IL had the poorest bid on the river. It seems the Gulf is bouncing around between 43 over to 51 over (bids) going nowhere fast. Soybean spreads ran flat to better especially against May 2019 forward. Meal spreads ran soft out to January while January ran bullish forward.
Both soybean and soybean meal charts are extremely strong looking. As long as the trade believes the US and China may be close to coming to terms the bias will be higher. How much higher – We first look at $9.30 followed by $9.50 followed by $9.70 followed by $10.00 (Nov). Dec meal will look at the mid-$350’s followed by the mid-$360’s. You’ll note that the soybean market has greater upside potential. If an accord is indeed reached crush margins will continue to move lower. You gotta love politics in the marketplace.
Daily Support & Resistance for 08/01
Nov Soybeans: $9.05 – $9.30
Dec Soybean Meal; $337.0 – $347.0
Dec Soybean Oil: $28.80 – $29.65
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