Soybean prices surged higher again on Tuesday up 16 ¼ cents for the Jan contract closing into new contract highs once again. Traders say that China is expected to extend a temporarily reduced import duty of 1% on soybeans, lower its soy oil tax and exempt imports of soybeans and soyoil from the 13% value-added tax has the market in a bullish mood. With daily reports of daily purchases out of China traders say demand is not waning. Crude oil surged to new contract highs as well helping to boost vegoil prices as the Dec Soyoil contract made new contract highs as well. Volume was heavy especially in the products 116,680 soybeans traded, 69,341 Meal and 75,433 Oil traded. Funds bought an estimated 6,000 Soybeans, 2,000 Meal and 5,000 Oil.
Early opening calls are lower. Talk this morning of profit taking expectations in the Soy complex after trading to new contract highs this week. Traders express caution however of being too bearish with crude oil surging higher today already up .70 cents in the January contract within earshot of $100.00 per barrel. The USDA Ag. Atteche' in iIndia raised his 2007/08 Indain Soybean production to 9.25 mmt. vs. his previous estimate of 8.09 mmt. and compares to last years crop of 7.69 mmt. Overnight Malaysain palm oil futures climbed 1.5% on Wednesday, this on top of Tuesdays 1% increase. Overall Palm Oil is up 49% this year. Overnight Taiwan bought 16,000 MT of U.S. Soybeans. Overnight Chinese Soybeans and Soyoil closed higher, Meal lower.
Early opening calls Soybeans 6 to 8 cents lower, Meal $ 1.00 to $ 2.00 lower and Oil .10 to .20 lower.
Top News
-- Exports: Taiwan bought 29,000 mt. US Corn and 16,000 Soybeans for Jan.
-- India state trading says they'll buy 3,000 mt of palm olein at $983/mt
-- USDA Weekly Export Sales report will be released on Friday, November 23, 2007, due to the Thanksgiving holiday.
-- 2007/08 Indian soybean production pegged at 9.25 mln mt vs prior estimate of 8.09 mln mt, acc. USDA Ag attache to India
-- High palm oil values could cut into potential soybean expansion in Brazil, as farmers in the north contemplate palm production - some analysts speculate palm production could triple by 2012
-- Dalian Soybean May futures higher 13 yuan to 4397 yuan/mt, but Sept off 29 yuan to 4368 yuan/mt on 743k contracts; May Soymeal off 13 yuan to 3398 yuan/mt & soyoil May futures up 100 yuan/mt to 9230.
-- eCBOT Soybean Vol. 84,333; Pit Vol. 26,944; Open Interest Change: -1,704
-- Weather: 6-10 Day Forecast: Below Normal Temps. Normal to Below Precip. The Corn Belt will see showers and some snow today ending by late tonight. Friday into Sunday looks dry. Temps mostly below normal.
-- Outside markets. Energy: crude put in new high overnight at $99.29, this AM its up 20c to $98.23/bbl ; Gold $10 higher & Silver: 12.5c higher; US $ mixed vs Euro, lower vs Yen.
Cash Markets
-- CIF Soybeans up 1 to 3. LH Nov. +42 to +44, Dec. +43 to +47, Jan. +52 to +55, Feb. +40 to +42, Mar. +37 to +41, Apr. +35 to +40,May +35 to +40, J/J +35 to +40.
Nathan T. Smith III
Linn Group
nsmith@linngroup.com
toll free: (877) 787-6278
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