Midweek trade was mixed in the soy markets, with soymeal marking good gains on Argentine weather/crop concerns. March soymeal closed above it’s 50 day moving average for the first time in a month, while March soybeans closed out a chart gap left from Tuesday, and closed higher. Commodity funds were estimated buyers of; 2,000 soybean and 3,500 soymeal contracts, and sold 3,000 soyoil.
In last week’s WASDE report, the USDA narrowed their season average soybean price forecast to $8.80-9.80, though the midpoint of the range was unchanged from the previous 2 months, at $9.30/Bu. The chart plots the midpoint of the USDA’s monthly price projections, along with the season average price implied by the CME. The CME price assumes a 5 year average national basis and is also weighted by monthly marketing rates. On average over the last 5 years, US farmers have sold and delivered 70% of their crop by the end of January. The CME today, has very little premium priced in and is valuing the crop at $9.45, or just $.15/bu above the USDA forecast. We look to use a rally back towards the Oct-Nov highs to add to sales.
