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NEAR-TERM MARKET FUNDAMENTALS: The market took direction from a bearish weather forecast to move sharply lower yesterday and pull some of the weather premium out. A relatively dry forecast for next week has helped relieve fears of ponding and yield loss from too much rain as traders see the first week of dry weather as a reason to suspect improving crop conditions. November soybeans pushed to the lowest level since June 14th even though export sales news was positive and monthly crush numbers were slightly above expectations. Soy oil followed soybeans lower while meal saw mixed results into early afternoon. Oil was pressured from increasing stocks. Some forecasters have added moisture in the Midwest on Sunday and Monday and again later next week, but the 6-10 day is still dry and a little cooler for the eastern half of the Midwest and Delta. Weekly export sales for soybeans were 308,300 tonnes for the current marketing year as compared with 53,200 tonnes needed each week to reach the USDA projection. Soybean oil sales were 45,500 tonnes as compared with 8,900 tonnes needed each week to reach the USDA projection for the year. China was 35,000 tonnes of the total. Cumulative export sales have reached 90.9% of the USDA projection for the season as compared with 66.8% as the 5-year average for this time of the year. The Census Bureau May crush total was 133.8 million bushels which slightly above expectations. Cumulative crush for the season has reached 78.5% of the total USDA forecast for the season as compared with 76.6% last year and 76.2% as the 5-year average after 9 months of the marketing year. The data suggests that both exports and crush could be revised higher in the next supply/demand report.
TODAY’S GUIDANCE: The market will need to see a significant yield threat on the horizon in order to expect any tightness in supply for the 2010/2011 season. World ending stocks look to swell to a record high level and US ending stocks will shift from relatively tight stocks of 185 million bushels this year (138 million last year) to a whopping 443 million bushels if yield comes in the same as last year. If there is a supply issue which might emerge to support, the continued buying from China of US soybean oil and the sharp loss in canola crops in Canada are factors which might support oil relative to meal.
Soybean Market Commentary – 2010.06.25
by Terry Roggensack on June 25, 2010
Below is a sample of our Daily Commentary. To get this comment, and our daily coverage of 15 additional markets and trade ideas, visit futures-research.com for your free 2 week trial!
NEAR-TERM MARKET FUNDAMENTALS: The market took direction from a bearish weather forecast to move sharply lower yesterday and pull some of the weather premium out. A relatively dry forecast for next week has helped relieve fears of ponding and yield loss from too much rain as traders see the first week of dry weather as a reason to suspect improving crop conditions. November soybeans pushed to the lowest level since June 14th even though export sales news was positive and monthly crush numbers were slightly above expectations. Soy oil followed soybeans lower while meal saw mixed results into early afternoon. Oil was pressured from increasing stocks. Some forecasters have added moisture in the Midwest on Sunday and Monday and again later next week, but the 6-10 day is still dry and a little cooler for the eastern half of the Midwest and Delta. Weekly export sales for soybeans were 308,300 tonnes for the current marketing year as compared with 53,200 tonnes needed each week to reach the USDA projection. Soybean oil sales were 45,500 tonnes as compared with 8,900 tonnes needed each week to reach the USDA projection for the year. China was 35,000 tonnes of the total. Cumulative export sales have reached 90.9% of the USDA projection for the season as compared with 66.8% as the 5-year average for this time of the year. The Census Bureau May crush total was 133.8 million bushels which slightly above expectations. Cumulative crush for the season has reached 78.5% of the total USDA forecast for the season as compared with 76.6% last year and 76.2% as the 5-year average after 9 months of the marketing year. The data suggests that both exports and crush could be revised higher in the next supply/demand report.
TODAY’S GUIDANCE: The market will need to see a significant yield threat on the horizon in order to expect any tightness in supply for the 2010/2011 season. World ending stocks look to swell to a record high level and US ending stocks will shift from relatively tight stocks of 185 million bushels this year (138 million last year) to a whopping 443 million bushels if yield comes in the same as last year. If there is a supply issue which might emerge to support, the continued buying from China of US soybean oil and the sharp loss in canola crops in Canada are factors which might support oil relative to meal.
Tags: Beanoil, Grains, Soybeans, Soymeal
About Terry Roggensack