May Soybeans closed 1 ¼ cents higher ($8.55 ½), July 1 ¾ cents higher ($8.61 ¼) & Nov 3 ¾ cents higher ($8.65 ¼)
May Soybean Meal closed $6.2 lower ($297.0), July $3.4 lower ($299.9) & Dec $0.9 lower ($302.6)
May Soybean Oil closed 40 pts higher ($26.83), July 40 pts higher ($27.15) & Dec 40 pts higher ($27.96)
Weekly Soybean Export Inspections – 298.1 K T. vs. 300-650 K T. expected
Soybeans are back to being caught between firming bean oil prices and sagging soybean meal prices. Many different private analytical groups are lowering the crop size in Brazil while still saying it will be record sized. Many estimates are now approaching the 123.0 M T. mark. CONAB will be out later this week. Last month they were at 124.2 M T. while most others were thinking 125.0-126.0 M T. I have to think most of today’s rally in the soybean oil was from spreading against soybean meal. Soybean meal continues to sag from ideas that many end-users got their needs satisfied from the rally two weeks ago when they were chased in believing US export share would become market making and now they are stuck with some high-priced meal.
The interior soybean basis to the processor runs unchanged. River locations do some minor flip-flopping. The Gulf is steady with Friday’s posting which is a few cents below the highs we saw early last week. Soybean spreads show a bearish bias within the current crop year and a noticeable bearish bias with the old crop/new crop spreads. The interior meal basis and its export basis run unchanged. The “however” is that meal spreads are crumbling.
July soybeans register an interim minor reversal with today’s trade, new lows for the current break followed by a higher close. Personally I don’t think this attempt at a soybean rally is going anywhere as long as the meal market stays depressed as you all should know by now how I feel about bean oil trying to carry the ball. Soybean meal is now within $5.00 of contract lows. Charts look ugly and not even oversold. Realize the meal market has been breaking for only 5 days (the same length as the rally). After today’s activity July soybean oil, once again, looks like it wants to see what $28.00 looks like.
Daily Support & Resistance – 4/07
July Soybeans – $8.50 – $8.74
July Soy Meal – $296.0 – $304.0
July Soy Oil – $26.70 – $27.60
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.