Soybeans were higher through Thursday’s trading and November was up 2.25 cents at the close. Soyoil futures marked the best close for the day on news that the Trump Administration’s EPA does not intend to reduce upcoming biofuel requirements, and was back above key moving averages. Funds were estimated buyers of; 4,000 soybean and 4,000 soyoil contracts, and sellers of 1,500 contracts in soymeal.
Soybean export sales for last week were towards the low end of expectations at 1.3 MMTs. To date, the US has shipped just over 7 MMTs versus 5 million last year, while total export commitments of 26 MMTs are 12% less than last year. The chart plots the relationship between mid-October commitments and annual exports, which is somewhat loose this early in the year. However, China continues to process beans at a record pace, and record large imports are expected in the year ahead. China should be routine weekly buyer into early 2018.
Our near term view is neutral, though we are anxious to use rallies to add to sales. A lasting soybean rally would need to be lead by a late year S American weather problem.
