Market News

Soybeans see slight bounce after recent decline

Soybeans were modestly higher on technical buying and commercial old crop/new crop spread adjustments, bouncing back from the losses in previous sessions. Beans are continuing to brace for the supply impact of record South American production. Many forecasts have near term harvest delaying rain in Brazil, but nothing serious is expected. Soybean meal was mixed, adjusting old crop/new crop spreads. Bean oil was up, supported by the higher trade in beans. The USDA’s attaché in Indonesia projects 2017/18 crude palm oil production at 36.5 million tons, but also expects increased soybean imports because of stable demand and a lack of restrictions on imports.

Corn was modestly lower on commercial and technical selling. Corn’s also watching South America with recent higher private estimates out of Brazil. Corn’s also expecting an impact on exports, just further down the road than with soybeans with Brazil’s second crop headed towards pollination. The trade’s also got an eye on planting ahead of the USDA’s prospective planting report. Ethanol futures were mixed, with nearbys mostly firm, ahead of the weekly EIA production and stocks numbers. According to Allendale and China Daily, China’s fist coal fired ethanol plant opened in January with a second facility expected to open in 2020.

The wheat complex was lower on commercial and technical selling. Many short and medium term forecasts have rain in dry parts of the Plains, but it could miss some areas. The supply side of the market is bearish and demand is no better than neutral, limiting any potential upside. The USDA’s quarterly stocks on the 31st should just reinforce the essentially neutral demand. World crop conditions are generally considered to be non-threatening to the overall fundamental outlook. Japan is tendering for 117,689 tons of food wheat from the U.S., Australia, and Canada.