Analysis: Soybeans

Soy Futures Rally Back Ahead Of The Weekend

Nov 17, 2:07 pm | Soybeans

Soybean futures marked good gains at the end of Friday’s trading, with the market finding support from fund short covering ahead of the weekend, and Argentine weather concerns. Soybean meal was the price leader through Friday’s trade as funds covered meal/oil bear spreads. At the close, soybeans were up 13-14 cents and back above all major moving averages, with meal gaining $5-6/ton. For the day, funds were estimated buyers of; 10,000 soybean and 7,000 soymeal contracts, and bought 500 contracts in soyoil.   While soymeal rallied to end the week, meal basis across the Midwest holds at multi year lows at many locations. The Central IL Processor’s report has quotes in a wide range from -$25 to +7 Dec, while quotes…

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Soy Complex Export Commitments

Nov 16, 4:50 pm | Soybeans

FAS reported weekly soybean export sales this morning at a 6 week low of 1.1 MMTs, with weekly exports at 2.3 MMTs. Those 2 figures together take total US soybean export commitments to nearly 33 MMTs. Cumulative export shipments according to FAS’s count now total 17 MMTs, up 1 MMT from last year, and the largest soybean export rate on record. However, it’s the pace of sales, or rather outstanding sales that is disappointing. Outstanding sales are down 5.5 MMTs (26%) from a year ago, with the total just short of 16 MMTs. The USDA has maintained a record large soybean export forecast of 61 MMTs for the last 3 months, which means that US exporters have committed 53% of…

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Soybean Prices Turn Back Down On Limited News

Nov 16, 4:49 pm | Soybeans

It was a slower and lower day of trade in the soy markets, that left soybeans down 3-4 cents at the close while the soy product markets gave back gains and finished lower. News for the day was limited to the export sales report, which did not offer any significant surprises. Commodity funds were estimated sellers of; 4,000 contracts each in the soybean and soyoil markets, and sold 2,000 soymeal.         The Buenos Aires Grain Exchange on Thursday estimated soybean planting progress at 24% complete, unchanged from a year ago but behind the 5 year average of near 32% complete. The Exchange held it’s estimate for soybean area steady at 18.1 Mil hectares, down 1.1 million from last year….

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2017/18 US Soybean Crush Update

Nov 15, 3:53 pm | Soybeans

NOPA reported that it’s membership crushed just over 164 Mil Bu of soybeans during the month of October, in line with expectations and nearly unchanged from a year ago. Based on the NOPA data, we estimate a total US soybean crush rate near 175 Mil Bu. The nearby soybean crush spread at the CBOT average near $.88/bu during the month versus $.75 last year and the 5 year average of $.95. The USDA projects a record large annual soybean crush rate of 1,940 Mil Bu, which at this time we agree with. But note in the chart that monthly crush rates need to hold at/near industry capacity well into 2018. Just 1 slow month will likely pull annual estimates down,…

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Soy Futures Recover At Midweek

Nov 15, 3:52 pm | Soybeans

Soy futures closed firm at midweek, with soyoil leading the CBOT soy complex higher on lower than expected NOPA stocks. Soybeans finished the day 9-10 cents higher, with funds estimated buyers of 7,000 contracts. In the soy product markets, funds were estimated as buyers of 1,500 soymeal and 6,000 soyoil contracts.       NOPA reported a monthly soyoil production figure of 1.896 Bil Lbs, an 18% increase from September, and the largest production figure since last October. But despite the larger production figure, monthly soyoil stocks declined 6% from September to 1.22 Bil Lbs, and fell well short of expectations for an increase to 1.4 Bil Lbs. The soyoil stocks figure lifted soyoil futures following the report release. The soyoil…

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Soybeans Slide Lower In Technical Trade

Nov 14, 2:25 pm | Soybeans

Soybeans stayed under pressure through Tuesday after breaking through major moving averages at the start of the week. Fundamentally the market is struggling under the large crop and slowing exports, while Brazilian weather forecasts have turned more favorable as planting starts to wind down. Funds were estimated sellers of; 6,000 soybean, 2,000 soymeal, and 3,500 soyoil contracts.   With harvest near complete across the Midwest, cash supplies pressures are easing and supporting cash basis up and down the US river system. The chart shows basis at terminals on the IL and MS rivers are now $.30 over the lows that were scored in late September. Basis at processors in the Eastern Cornbelt has also improved, though cash markets across the…

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Soybeans Start The Week Lower On Liquidation

Nov 13, 4:08 pm | Soybeans

Soybeans closed lower on Monday on technical selling following disappointing US export data and favorable S American weather forecasts. Funds were estimated sellers of; 9,500 soybean, 4,000 soymeal, and 5,000 soyoil contracts. After the close, the Commitment of Traders report showed that as of last Tuesday, funds had been net long nearly 47,000 contracts in soybeans.     Soybean export inspections were within expectations, but fell to a 4 week low of 77 million bushels. After a strong start to the year, inspections began to disapoint in late October and the export has steadily slipped further behind last year as Brazil has maintained strong late season exports.   NASS reported that the 2017 soybean harvest has now reached 93% complete versus…

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Nov-Jan US Yield Changes

Nov 10, 4:21 pm | Corn, Soybeans

NASS still has one report left to fine tune US 2017 US row crop production,  major changes are unlikely. A corn yield above 170 (to say nothing about record yield) has been a surprise, but in January ARC expects yield to be maintained at 175, give or take fractions of a bushel. The adjacent graphic shows changes in corn & soybeans yields from Nov to Jan since 2000, it’s been rare for yields to change by more than 1.5%. In fact, since 1980, yield adjustments of just 1% or less catch a majority of NASS’s final report estimates. Even a yield change of 1.5% would imply corn yield up or down 2.5 Bu/acre, and a bean yield change worth just…

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Soybeans Bounce to End the Week On Weak Brazilian Real

Nov 10, 3:58 pm | Soybeans

Soy futures bounced to end the week with funds moderate buyers as January soybeans held the first line of support at $9.85. However, the rally was met with Brazilian soy hedging as the real declined 1% to settle at 3.28:1 USD. Funds were buyers of; 3,200 contracts of soybeans and 2,600 contracts of soymeal, while selling  2,500 contracts of soyoil. Unwinding of Long Oil/Short meal spreads was noted.   China’s soy import pace continues to disappoint from the US with weekly export inspections already reaching an early annual high. ARC argues that US 2017/18 soybean exports could easily be 50-100 Mil Bu less than WASDE based on Brazil’s late season export pace and now new concern over China’s slowing on…

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Analysis of the USDA’s November Reports

Nov 9, 4:52 pm | Corn, Soybeans, Wheat

World 2017/18 stocks of wheat/soybeans are record large and up a combined 13 MMTs, while world corn stocks are down 23 MMTs to 204 MMTs! The net result is that Global Major World Crop ending stocks are down 10 MMTs, the first stock fall in 4 years! From 2012 into 2016, world major grain stocks grew just over 50% as world grain production was nearly double the growth in world demand. Somehow, world grain consumption has to catch up with production with most private estimates pegging China’s corn stocks some 75-100 MMTs above the WASDE forecast of 79 MMTs.   The graphic of global major crop ending stocks reflects that there is an abundance of grain in the world, and…

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