Soybeans were able to build on Tuesday’s rally and closed up 2-3 cents at the end of Wednesday’s trading. Soybeans and meal each marked the best closes since the August crop report, while soyoil also marked modest gains. Funds were estimated buyers of 1,500 contracts each in soymeal and soyoil, and bought 3,000 contracts in soybeans.
Stat’s Canada reported end of July canola stocks at 1.35 MMTs which was below expectations, down 35% from a year ago, and also the lowest stocks figure in the last 4 years. In the last decade, the only years in which stocks were tighter were the year of and year following the 2012 drought. Canadian canola futures traded mixed following the report release, but confirmation of tight stocks is likely to hold Canadian canola futures at strong premiums to CBOT soybeans.
November soybeans closed back above the contract’s 50 day moving average on Wednesday. Our view stays bullish on breaks on concerns that limited August rains have lowered crop yield potential.
