Soybeans were on both sides of unchanged through Wednesday and around unchanged at the close. Neither rallies nor breaks could get much tractio with November finding support against the 50 day moving average. Commodity funds were estimated sellers of 1,500 contracts in soybeans/meal (each) while buying 3,000 soyoil.
Soybean oil led the complex higher at midweek and December was back above the 200 day moving average for the 2nd consecutive day. The chart shows that while US soyoil has traded higher since early June, spot palm oil has moved the other direction. The soy/palm oil spread has moved from a 1.4 cent/lb soy premium, to more than 6 cent premium this week. Funds net long soyoil position at 67,913 contracts was the largest since February. The spread gain could be related to the falling production of Canadian canola.
A US soy yield under 47.0 BPA will be bullish, while a yield above 48 BPA would be bearish. Based on the arid Midwest since late July, ARC expects that importers and end users would be buyers of a post report drop. November beans under $9.50 is tough to justify.
