July Soybeans closed 22 ¾ cents lower ($8.51 ¾), August 21 ¾ cents lower ($8.55 ¾) & Nov 22 ½ cents lower ($8.72)
July Soybean Meal closed $8.0 lower ($331.8), August $8.2 lower ($329.9) & Dec $9.6 lower ($327.8)
July Soybean Oil closed 16 pts lower ($28.74), August 16 pts lower ($28.86) & Dec 20 pts lower ($29.26)
USDA announces 132.0 K T. new crop soybeans sold to unknown
Weekly Soybean Export Inspections – 654.8 K T. vs. 375-900 K T. expected
Weekly US Soybean Conditions & Progress – 71% GE (unch) vs. 70% expected vs. 62% year ago – Blooming – 47% vs. 32% year ago vs. 27% 5-year average – Setting Pods – 11% vs. 6% year ago vs. 4% 5-year average
For as ugly as the complex traded on Monday it was just an inside day of Friday. Nothing from Friday has changed as we’re still looking at tariff enactment from both the Chinese and the US. It has been reported that the USDA will try to incorporate the impact of the Chinese tariffs on US soybean imports. How much they cut US exports/Chinese imports remains to be seen. This Thursday the USDA will update supply-demand. It is my thought that the USDA will use the June 29th acres but leave the yield unchanged. That would suggest a production increase of 29 million bu. The most recent trade estimate for carryout is looking for an increase of 86 million bu.
Soybean processors continue to show the best bids out there. This is rightly so given the lofty Board crush margins. The export market is quietly steady. August soybean spreads ran steady to fractionally better out to January but then slacked off March forward. Offers to sell cash meal were easier for domestic sales while a bit better for export sales. Meal spreads involving the August contract ran better out to the December. December forward ran steady to weaker.
So who wants to believe Friday’s suggested reversals followed by Monday’s inside day? It’s going to come to crop conditions followed by how much the USDA incorporates the potential impact of the Chinese tariffs. As far as I’m concerned it’s one day at a time. For what it is worth – Friday’s low in November soybeans was $8.53 ¼. This matched the September 2015 low for November soybeans. One has to go back to the spring of 2009 to find lower prices for November soybeans.
Daily Support & Resistance for 07/10
Aug Soybeans: $8.42 – $8.68
Nov Soybeans: $8.56 – $8.82
Aug Soybean Meal; $326.0 ($322.0) – $335.0
Aug Soybean Oil: $28.40 – $29.40
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.