Soybeans ended the week in negative fashion down 9 cents in the Jan contract. Traders say a combination of falling crude oil prices and gold as well as harvest pressures contributed to the break. Volumes were heavy once again with the CBOT reporting 116,128 soybeans, 51,643 soybean oil and 35,894 meal traded. Funds sold 5,000 soybeans, 2,500 oil and 2,000 meal.
Today's early opening call is for a hard down open with calls ranging from 15 to 20 cents lower. A global commodity sell-off occurred overnight starting with the Asian markets, led by a rallying dollar. The weakening $US in recent weeks has been attributed to the strength in commodities overall and today's rally has taken some of the premium out of these prices. Across the board you are seeing lower commodity prices including energy, precious metals, and grains. Further reaction from the informa numbers released Friday could be in the offing. Informa estimates soybean acreage to be 71.7 mil acres up 8 mil from last year. Traders say the debate on acreage is just starting and we are being reminded to remain cautious as analysts projections will vary greatly. Taiwan is expected to re-tender for beans which they passed on this week. As expected rains moved into the drier portions of Brazil, improving crop planting conditions there. Drier weather in the US Midwest should provide good finishing weather for harvest.
Early Opening Calls: Beans 20 lower; Oil .40 to .60 lower; meal $3.00 to $5.00 lower.
Top News
--Commitment of Traders report with Options as of October 16 shows funds long 131,764 soybeans up 5,584
-- Meal long 62,661 up 5746
-- Oil long 57,315 up 5,592
-- Supplemental report shows index funds long 166,146 up 6,857
-- Dalian Soybean futures active May 48 yuan/mt lower, soymeal futures lower, May soyoil futures sharply lower off 118 yuan/mt.
-- Malaysian Palm oil Jan futures closed sharply lower off 51 ringgit, or down 1.8%. Overnight fall in soyoil futures markets & sharply lower crude oil markets weigh.
-- eCBOT Soybean Vol. 85,885; Pit Vol. 25,877; Open Interest Change: +191
-- Weather: Normal to Below Temps. Normal to Below Precip. Corn Belt will see showers and thunderstorms move west to east today into Tuesday.
-- Outside markets. Energy: crude $1.40 lower, products lower; Gold off sharply -$15.00 & Silver: off 20c; US $ sharply higher vs Euro, lower vs Yen.
Cash Markets
--CIF Soybeans up 1 to 5 . Oct. +25 to +35, LH Oct. +30 to +??, Nov. +44 to +47, Dec. +40 to +47, Jan. +47 to +52, Feb. +30 to +40, Mar. +35 to +42, Apr. +35 to +40.
Nathan T. Smith III
Linn Group
nsmith@linngroup.com
toll free: (877) 787-6278
local: (312) 896-2090
fax: (312) 896-2050
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