Overnight selling in soybeans found support in an open chart gap that was left from Monday, and the market traded higher into the close. Rain across parts of the Cornbelt pressured markets overnight, while heat/dryness in the extended outlook offered support.
At the close soybean prices were 4-5 cents higher in both old and new crop contracts, with November soybeans marking a new rally high, while Monday’s gaps also held in the soymeal market. Commodity fund traders were estimated buyers of 6,000 soybean, 1,000 soymeal, and 3,000 soyoil contracts.
Preliminary Chinese trade data is expected to be released overnight, with record or near record large June imports of around 8 MMTs expected.
Soybean option volatility has been well under the 5 year average through the growing season, but has expanded in recent weeks. But note that even after an unprecedented $1.40/bu rally off the June lows, option volatility is just above the seasonal average for mid July.
Quieter trade is expected into the July WASDE report on Wednesday. The report is often uneventful. Once the report is out, we expect the market’s focus to shift back to July weather and yield expectations. The Midwest forecast is warm/dry into late July
