Soybeans and Products
General Comments: Soybeans and Soybean Oil closed higher, with most of the Soybeans strength seen in new crop months. Ideas that the index funds were rolling hurt July futures. Soybean meal closed lower on ideas of poor demand. Demand was seen in Soybeans and unknown destinations bought 132,000 tons. Ideas are that China is adding to purchases. The US is a primary beneficiary of the lack of selling in Brazil this year. Speculators appear to be the best sellers right now as they add to short positions. Ideas were that the better weather in the Midwest could mean that more área gets planted to Soybeans. It was drier than expected in the Midwest over the weekend and should remain drier this week. Overall the trade remains bearish on the price potential for the entire complex. The market thinks that there are big supplies coming some day from Latin America and also expects a huge crop in the US, so buying interest is harder to find these days even though demand is holding together very well in the export market. Basis levels at the Gulf of Mexico for Soybeans are steady to firm, but South American basis levels have been more stable. USDA is expected to make few overall changes to the balance sheets in its latest monthly estimates that will be released later this week.
Chart Analysis: Trends in Soybeans are mixed. Support is at 920, 910, and 903 July, and resistance is at 930, 942, and 949 July. Trends in Soybean Meal are mixed. Support is at 300.00, 297.00, and 295.00 July, and resistance is at 305.00, 307.00, and 310.00 July. Trends in Soybean Oil are mixed to down with objectives of 3010 July. Support is at 3070, 3050, and 3020 July, with resistance at 3160, 3200, and 3230 July.
General Comments: Wheat closed little changed in quiet trading in Winter Wheat markets. Spring Wheat was higher again on forecasts for more rain in Canada through the weekend and overall low condition ratings. USDA showed that crop conditions went down last week as it has turned very warm and dry in the Dakotas. There is a drought forming in these states right now. Crop emergence is now ahead of the five-year average. Winter Wheat crop conditions also were lower as the crop is heading and as the harvest is now starting. Better weather in the forecast kept any rally potential in check for the Winter Wheat markets. It is dry and warmer in the Great Plains and the harvest is increasingly active. The harvest is underway in Texas and Oklahoma, and reports are mixed. Initial results indicate that the protein levels are not strong in the Great Plains and are near 10.4%. Yields are not strong and average between 25 and 35 bushels per acre. However, there are reports of strong test weights as well. The Kansas crop has been slow to mature and the harvest there will not begin for at least another week. The demand for U.S. wheat is holding well in world export markets and the U.S. dollar is weaker to help keep U.S. wheat in the mix for world demand. The chart patterns are generally sideways or positive, especially for HRS.
Overnight News: The southern Great Plains should get dry weather or light precipitation, with best chances for precipitation this weekend. Temperatures should be below normal. Northern areas should get dry weather or light precipitation, with best chances for precipitation this weekend. Temperatures should be near to below normal. The Canadian Prairies should see dry weather today, then increasing chances for showers. Temperatures will average near to above normal.
Chart Analysis: Trends in Chicago are mixed. Support is at 426, 422, and 420 July, with resistance at 439, 442, and 445 July. Trends in Kansas City are mixed. Support is at 424, 421, and 413 July, with resistance at 440, 444, and 451 July. Trends in Minneapolis are up with no objectives. Support is at 574, 571, and 569 July, and resistance is at 590, 594, and 598 July.