The soybean market blasted past last Thursdays spike highs on the charts overnight, sending the market into new contract highs. Money flow and proof that we continue to chew through old crop soybeans is keeping the market very well bid, chewing up and spitting out bears along the way.
Export sales for soybeans came in at 772k MT for old crop and an additional 256k for new crop yesterday which was within market expectations and puts the Marketing year sales at 107.5% vs the 5 year average 86% needed to hit the USDA benchmark. Even with no more sales (and no more cancellations), the USDA would need to adjust soybean exports higher by 104 million bushels. This would leave ending stocks at 46 million bushels.
Last year, the trade considered 125 million bushels as the pipeline minimum. As the export pace continues to burn through beans the trade is wondering whether the USDA will finally be forced to tighten its projected carryout in Monday’s monthly supply and demand report. Trade estimates for the March WASDE are pegging soybean ending stocks at 141 million bushels vs 150 in Feb and in line with last years 141.
The trade is looking for 13/14 Brazil soybean output at 88.0 MMT down from February’s report estimate of 90.0 in Monday’s USDA WASDE report. Argentine soybeans are seen at 53.5 MMT down from February’s report estimate of 54.0. The weekly report from the Buenos Aires Grain Exchange on Thursday raised their Soybean production outlook to 54.5 MMT up from last week’s 53.0.
In yesterdays price action, the soybean market challenged last Thursday’s spike highs on the charts, firming steadily throughout the day fueled by another strong export sales report, which showed we chewed through another 772k MT of old crop beans. Money flow continues to support the market. We we’re able to take out the highs, but were able to establish a new high close.
After the close, May soybeans were 17-1/2 higher at $14.38, while new crop was up 6-1/4. Daily volume in soybeans fell by 14% Thursday to 157,486, with open interest up 4,781 on only modestly active fund buying. There were no new soybean contracts registered for delivery Wednesday, and no deliveries today either.
Outside markets have crude firmer, precious metals lower, the dollar flat and U.S. equities called higher after the U.S. Bureau of Labor Statistics showed 175,000 jobs were added to nonfarm payrolls in February versus a consensus estimate of 149,000.
LaSalle Street News Top News
— Cash sources on Friday noted 60,000 mt of rapeseed was bought by Pakistani traders, the origin was said to be Australian and was bought for a reported $604.50/mt cif
— Report from the USDA attache to China forecasts 2014/15 Soybean imports at 72 mln mt, they pegged 13/14 Soybean imports at 68 mln mt, that’s off -1.0 mln mt from the official USDA estimate
— USDA attache to China expects bird flu worries among consumers to push broiler poultry meat production in 2014 down to 12.9 mln mt off -6.0% from the official USDA forecast.
— China’s Ag Minister yesterday told the Peoples’ Congress that they’re concerned over food safety and GM foods, but are looking at innovating technology used in agriculture including genetically modified organisms
— Canadian transportation officials are expected to unveil on Friday new measures to address the lack of railway capacity to help alleviate grain shipment backlogs.
— Buenos Aires Grain Exchange weekly report Thursday estimated 40.7% of the sunflower seed crop has been harvested (last week 28.2%) so far with 871,438 mt collected, the exchange forecasts the full crop at 2.30 mln mt
— Weekly report from the Buenos Aires Grain Exchange on Thursday raised their Soybean production outlook to 54.5 mln mt up +1.5 mln mt from last week’s 53.0 mln mt
— Ahead of Monday’s USDA monthly report, analysts expect Soybean ending stocks at 140 mln bu vs February’s 150 mln bu
— Ahead of Monday’s USDA monthly report, analysts expect 13/14 World Soybean ending stocks at 71.5 mln mt compared to February’s 73.0 mln mt.
— Ahead of Monday’s USDA monthly report, analysts expect 13/14 Brazil soybean output at 88.0 mln mt down from February’s report estimate of 90.0 mln mt.
— Ahead of Monday’s USDA monthly report, analysts expect 13/14 Argentina soybean output at 53.5 mln mt down from February’s report estimate of 54.0 mln mt.
— Pending Tender: Cash traders on Friday say March 3rd is deadline in 10,000 mt optional origin Sunseed oil tender floated by Iraq.
— Pending Tender: On Monday Bangladesh announced 2,000 mt Soyoil tender to close on March 19th.
— Liffe Paris May rapeseed futures on Friday trading +4.50 euros higher at 418.50 euros/mt
— Dalian Sept soybean futures traded on Friday at off -10 yuan at 4,468 yuan/mt, Sept soymeal futures were up +17 yuan at 3,306 yuan/mt
— Dalian Sept vegoil futures were higher on Friday, soyoil futures jumped +114 yuan to 7,188 yuan/mt, while palm oil futures added +86 yuan to finish at 6,414 yuan/mt
— Cash sources on Friday noted May/Jun Malaysian cash offers of both RBD palm oil and palm olein were up $7.50 to $912.50/mt
— Malaysian May crude palm oil futures finished Friday’s session at 2,886 ringgit/mt up +0.8% on the day
— CBOT Soybean Volume & Open Interest for March 6th 2014 was 157,486; Open Interest increased +4,781 to 664,432.
— CBOT Soybean Oil Volume & Open Interest for March 6th 2014 was 86,156; Open Interest increased +1,434 to 302,647.
— CBOT Soybean Meal Volume & Open Interest for March 6th 2014 was 65,887; Open Interest increased +3,542 to 315,449.
— CBOT March 2014 Soybean Futures Delivery Report: 0 for intent date (n-a), and 140 month to date [Delivery Date – (n-a)]
— CBOT March 2014 Soybean Oil Futures Delivery Report: 439 for intent date 03/06, and 6,372 month to date [Delivery Date – 03/10)]
— CBOT March 2014 Soybean Meal Futures Delivery Report: 0 for intent date (n-a), and 5 month to date [Delivery Date – (n-a)]
— Outside markets. Crude Oil up +47c @ $102.03; Gold off -$2.50 @ $1349.30 ; Silver off -19c @ $21.38 ; US $ index off -20 pts @ 79.46
LaSalle Street News Cash Markets
Bean Barge Corn Barge SRW Barge HRW Track Ill Riv Frt
FH Mch +96/99 H +88/98 H +102/110 H 625
Mch +94/97 H +86/90 H +95/105 H +162/170 H 575
Apr +88/91 K +74/77 K +85/90 K +155/158 K 500
May +80/87 K +70/75 K +85/90 K +152/158 K 475
Hi-pro meal Soy oil
Chicago +3 K -4 K +25 K
Toledo +17 K -17 K -5K
Dec ILL +25 K -10 K +31 K -100 K