The bulls are doing an admiral job of defending their long position in front month beans this morning. The market has pushed out to new highs overnight, but has given back a nickel after the morning pause. On the charts, beans are testing our fall highs which extend up to $13.77 ¾ in SH, a rally to that level would also close the weekly island top gap which is significant, look for support on a break at $13.35.
Once again this morning there were no announcements of exports or cancellations, which heading into a long 3-day weekend might be supportive. Bean basis bids at the Gulf gained 7 cents yesterday to +105, Decatur is steady at +20H. Export sales were disappointing at just under 300,000 MT yesterday morning, which was under half of expectations.
China was a net buyer of 19,700 mt with purchases of 320,700 reported of which 301,000 were switched from unknown. The report also showed China cancelling 116,900 mt for old crop. USDA baseline projection estimates, put 2014 soybean acres at 78.0 million, the crop at 3.40 billion bushels and ending stocks at 203 million bushels.
Soybean price projections were set at $9.75/bu for 2014/15. Chinese soybean imports were estimated at 72.8 MMT up sharply from 13/14 projections of 69 million.
In yesterdays price action the soybean market tossed aside a disappointing export sales report and drifted steadily north into new highs that stretch all the way back to Mid-September. March meal followed suit putting in new highs as well. Chinese cancellations and GMO issues still surround the market, but building open interest suggests funds are piling in. After the close, March soybeans were 21- 1/4 cents higher at $13.44-1/4, while new crop was up 15 cents.
Daily volume in soybeans surged 27% to a heavy 336,824 on Thursday, with open interest up 12,973 on fund buying. The average February price for Revenue Protection rose to $11.18. On the weather front, much needed rain is expected in Brazil tomorrow and through the weekend.
LaSalle Street News Top News
— On Thursday traders said Meditrade in Egypt bought 29,000 mt of sunseed oil in a tender that closed yesterday
— China’s Nat’l Grain & Oils Info Center on Friday forecast 2013/14 soybean output will fall to around 12.0 mln mt off -8.0% from the year ago period and is down from the 12.2 previously estimated.
— During January India imported 905,814 mt of vegoils off from December’s 1.067 mln mt of imports, according to the industry group Solvent Extractors’ Association
— India Solvent Extractors’ Association pegged January palm oil imports at 555,446 mt off from December’s 863,205 mt and 893,313 mt from the year ago month
— India’s gov’t forecast 2014 wheat harvest at 95.6 mln mt up from last season’s 92.46 mln mt, the gov’t also forecast the country’s rapeseed harvest at 8.25 mln mt up 450,000 mt over the previous.
— Weekly report Thursday from the Buenos Aires Grain exchange kept their Soybean production forecast unchanged on the week at 53.0 mln mt, with yields averaging 20.35 mt/ha
— The Federal Reserve Bank of Chicago and St. Louis released a report showing farmland values rose 3% in the third quarter to fourth quarter of 2013. Cash rents were reported steady to higher for 2014.
— USDA Baseline Projection Stats: 2014 US soybean plantings 78.0 million acres, with a crop of 3.40 billion bushels, putting ending stocks at 203 million bushels.
— USDA Baseline estimates peg 2014/2015 crop year China soybean imports at 72.8 million metric tons, up sharply from 13/14 projections of 69 million
— Pending Tender: Vegoil sources say 10,000 mt of optional origin sunseed oil is being sought by Iraq in a tender that closes on Feb 9th
— Pending Tender: Cash grain traders said 3,000 mt of optional origin Soyoil is being sought in a Bangladesh tender to close on Feb 10th
— Pending Tender: In a tender that closes on Feb 20th, Egypt’s state run FIHC announced Wednesday they’re seeking 20,000 mt of Soyoil for delivery between March 25th to April 15th.
— Liffe Paris May rapeseed futures on Friday trading up +3.25 euros at 381.50 euros/mt
— Dalian May soybean futures on Friday finished the session up +1 yuan at 4,722 yuan/mt; May soymeal futures gained +29 yuan on Friday to finish at 3,439 yuan/mt
— Dalian May vegoil futures were higher on Friday, both palm oil and soyoil futures gained +58 yuan on the day to finish at 5,990 yuan/mt and 6,736 yuan/mt, respectively.
— Cash sources on Friday said Malaysian cash offers on Feb/Mar RBD palm oil and palm olein were again both +$12.50 higher at $842.50/mt
— Malaysian crude April palm oil futures gained +0.4% on Friday ending the week at 2,667 ringgit/mt
— CBOT Soybean Volume & Open Interest for February 13th 2014 was 336,824; Open Interest increased +12,973 to 688,806.
— CBOT Soybean Oil Volume & Open Interest for February 13th 2014 was 190,825; Open Interest increased +4,975 to 356,873.
— CBOT Soybean Meal Volume & Open Interest for February 13th 2014 was 130,961; Open Interest increased +6,242 to 306,848.
— Weather: 6-10 Day forecast: Above Normal Temps. Above Normal Precip
— Outside markets. Crude Oil off -33c @ $100.02; Gold up +$17.00 @ $1317.10; Silver up +67c @ $21.065; US $ index off -21 pts @ 80.16
LaSalle Street News Cash Markets
— CIF Soybeans steady up 7. FH Feb. +105 to +??, Feb. +90 to +105, Mar. +80 to +84, Apr. +88 to +92, May +75 to +82