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Soybean Market - Just My Opinion

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Soybeans and soybean meal take their direction (higher) from Argentine weather. Weekend weather down there did see some moisture but supposedly not enough to offset forecasts calling for warmer and drier as we move further into the month of December. For what it is worth Brazil continues to be in great shape. Weekly export inspections went far in supporting the market when profit taking set in at midday. Soybean meal was a noticeable gainer on the day as it derived support from the USDA monthly crush report on Friday where it showed some outstanding domestic demand. Im also hearing that given recent currency fluctuations US meal for export is now competitive with Argentina (at least it was Friday afternoon). Bean oil saw its monthly crush data as bearish. Additional meal/oil spreading furthered bean oils recent decline.

Interior soybean basis levels are mostly steady. Basis levels long the river systems that feed into export continue to flip-flop all over the place. Gulf prices appear to have firmed following last weeks weakness. Bull spreads were working on Monday all the way out to the new crop. Despite the USDA suggesting excellent domestic demand for soybean meal offers to sell the cash product continue to show a depressed look. Bull spreads in meal ran in the samedirection as soybean spreads. For what it is worth despite the flat price of soybean oil being lower bull spreads were working especially old crop to new crop. In early October the July/Dec bean oil spread sat at even money; todays close was 59 over. This tells me the bull play for soybean oil remains in intact for further down the road considerations.

Soybean and Soybean Meal charts look quite strong and Soybean Oil just the opposite. Were up here on Argentine weather. If you want the rally to continue Argentine weather needs to maintain a warm and dry bias just like the current forecasts are suggesting.

Daily Support & Resistance for 12/05

Jan Beans: $9.91 - $10.05

Jan Meal; $332.0 - $340.0

Jan Bn Oil: $33.00 - $34.00

Trading Futures is Risky - Never Risk more than what you have to Risk

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About the author

Tom Fritz is a third generation commodity futures trader. His grandfather and his father were traders on the exchange. Tom began his career in 1971 with Tabor Grain which was later acquired by Archer Daniels Midland. Prior to co-founding IFG in 1994 Tom was the lead Chicago Board of Trade floor analyst for ADM. He produces Just My Opinion, a daily grain commentary that is well respected and viewed all over the world.



Contributing author since 11/7/2017 

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