Soybean Commentary
Jan Soybeans close 5 ¾ cents lower ($9.61 ½), March 5 ½ cents lower ($9.72 ½), July 5 ½ cents lower ($9.93 ½) and Nov 5 ½ cents lower ($9.82 ½)
Jan Soybean Meal closes $2.1 lower ($318.5), March $2.0 lower ($322.5), July $1.1 lower ($329.0) and Dec $0.2 lower ($326.4)
Jan Soybean Oil closes 14 pts lower ($33.02), March 16 pts lower ($33.18), July 18 pts lower ($33.48) and Dec 17 pts lower ($33.14)
USDA announces 396.0 K T. soybeans sold to China
Weekly Soybean Export Inspections – 1.774 K T. vs. 1.100-1.400 M T. expected
Weekend forecasted rains for Argentina came to fruition. More is forecasted for later this week. Brazilian growing conditions continue to be nothing less than great. With that said soybeans and soybean meal moved to new lows for the current sell-off. Soybean oil received some left handed support from inter-market spreading; selling beans and meal vs. buying soybean oil. Weekly export inspections were deemed solid but without any major problems in SA the future of US soybean demand is questionable later on in the marketing season.
The past two week break in soybeans has interior basis levels holding steady at worst; better in many locations. Prior to early December producers had been willing sellers on the rally but with the current break movement has been pretty much shut off. Gulf prices chop back and forth above lows made earlier this month. Soybean spreads on Monday ran steady to fractionally softer. Offers to sell soybean meal continue to run at or near historic lows. Meal spreads were soft within the current year – noticeable losers vs. the new crop.
The price action for soybeans and soybean meal suggest the market is searching for support but not finding any. It seems like the prospect for another kick-ass crop out of SA gets better as each day goes by and that in turn limits any buying. I can’t say the bean and meal markets are oversold on a daily basis but I can say they are on an inter-day basis. That may bring us some attempts at some minor consolidation and/or minor upside retracement ahead of the holiday weekend but beyond that the path of least resistance continues to be lower. Bean oil is trying to realize support around the $33.00 level (give or take 20 pts) but every time it tries to rally it keeps slipping back. If beans and meal continue lower bean oil won’t be far behind but to a lesser extent.
Daily Support & Resistance for 12/19
Jan Beans: $9.50 – $9.72
Jan Meal; $314.0 – $325.0
Jan Bn Oil: $32.75 ($32.50) – $33.40
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