Market News

Commercial demand sends soybeans higher

Soybeans were sharply higher on commercial and technical buying, settling just below the month’s highs. Demand continues to be strong, tied to the continued strength in soybean meal, with July meal closing above $400 per short ton. That’s the highest spot price since December 2014 and is almost $17 higher than the August contract. The market’s keeping an eye on the potential for an increase in acreage. Soybean meal was sharply on that commercial demand and bean oil was up, along for the ride.

Corn was higher on commercial and technical buying, with all months above $4. Forecasts have more near term planting delays in some key growing areas. Contracts are in a sideways range, but have the potential to break overhead resistance if the momentum continues. Ethanol futures were higher. The EIA reports ethanol production for the week ending May 20th averaged 946,000 barrels per day, down 2,000 on the week, and stocks, at 20.813 million barrels, were also below the previous week’s level. According to wire reports, China will sell 2 million tons of corn and 200,000 tons of rice from state reserves Friday.

The wheat complex was mixed with Chicago and Kansas City supported by commercial and technical buying. Recent severe weather may have caused some damage to Kansas’ wheat crop. The fundamentals are bearish, but wheat’s able to generate interest at these price levels. Wire services reports Indian flour mills have signed papers of 500,000 tons of milling wheat from Australia and France because of drought drawing down supplies.