Soybeans Commentary

storck

Soybeans – Just My Opinion

Sept Soybeans closed 13 ¼ cents lower ($8.20 ¼), Nov 13 ½ cents lower ($8.31 ¾) & March 13 ½ cents lower ($8.58 ¼)

Sept Soybean Meal closed $1.7 lower ($314.2), Oct $2.1 lower ($314.2) & Dec $2.4 lower ($316.2)

Sept Soybean Oil Closed 30 pts lower ($27.73), Oct 28 pts lower ($27.82) & Dec 28 pts lower ($28.08)

CONAB – Brazilian soybean production – 119.3 M T. vs. 118.98 previous vs. 119.5 USDA

USDA announces cancellations of 192.0 K T. of soybeans sold to unknown

Weekly Soybean Condition & Progress – 68% GE (+2%) vs. 65% expected vs. 60% year ago – Dropping Leaves – 31% vs. 19% 5-year average

Today’s lower trade throughout the complex is a tell-all from the funds – they want to be short!!! The trade is anticipating a hike in yield; 52.2 bpa vs. 51.6 bpa. In addition they are expecting the US carryout to rise by 45 million bu. to 830 million. The World soybean carryout is expected to rise by 1.35 M T. to 107.29 M T. I do need to point out that last month despite seeing a rise in the World carryout for soybeans the world carryout projections for meal and bean oil actually dropped. It sounds like to me it will be the year for the “crush”.

The interior soybean basis continues to be ugly. The Gulf basis for soybeans is just as ugly. Soybean spreads ran pretty flat all the way out to the new crop. Needless to say soybean spreads are pretty wide. For what it is worth – I’m being told FOB soybeans at the Gulf are 27% cheaper vs. FOB Brazil. Isn’t the tariff on soybeans 25%?  Offers to sell domestic soybean meal remain lethargic. Nearby offers at the Gulf ease ever so slightly while October forward offers rise. Meal spreads ran with a firm bias all the way out to May and they flattened out.

Tuesday’s price action says it all – the spec trade wants to be bearish for tomorrow’s USDA report. It’s going to come down to just how bearish will the report be. An unchanged yield should provide us a rally.

Daily Support & Resistance for 09/12

Nov Soybeans: $8.20 (?) – $8.60

Dec Soybean Meal: $308.0 – $331.0

Dec Soybean Oil: $27.10 – $29.20

 

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.