November soybeans were up 12 1/2 cents late in the overnight session. Chinese soybean futures were up 0.3% overnight and were also higher on Monday. Malaysian palm futures closed down 0.3% to a new 8-month low. Outside market forces look mostly negative today with strength in the US dollar, but this is partially offset by strength in metals and energy markets. Meal deliveries were 1,036 contracts this morning, and oil deliveries were 547. There were still no deliveries for July soybeans. Strength in European and Asia markets, continued rumors of interest from China in booking mostly South American soybeans and a general concern that heat will linger near the Midwest and could cause some issues with crops in the south has helped to support the market. The National Grains and Oils Information center believes that China production this year will come in around 14 million tonnes, down 7.9% from last year. This is expected to be offset by increasing imports. November soybeans traded sharply higher on Friday, taking back most of its losses from Thursday. The break had left the market in an oversold condition, especially considering that the USDA reports were not really bearish for soybeans. The fact that corn was trading freely helped ease some of the selling pressure on soybeans, but the upside was limited by some light strength in the US dollar and a steep sell-off in energy markets. Positive economic news helped support higher trade in the stock market, and this supported a bounce in soybeans. The Midwest saw a few days of hot weather early in the holiday weekend, and good growing conditions are expected for this week and maybe next week. The presence of a heat dome back into the southwest has traders somewhat nervous that conditions could worsen at any time back into the Midwest. For now, hot and sometimes dry weather could be seen as negative for crops in the southern part of the Midwest. The slowdown in selling by fund traders and uncertainty about the weather forecast from mid-July on helped spark some end-of-week short-covering late last week, and this appeared to continue with the overnight action. The Commitments of Traders reports as of June 28th showed non-commercial traders in soybeans were net long 53,297 contracts, a decrease of 13,567 contracts for the week. The long liquidation selling trend is seen as a short term negative force. Commodity index traders held a net long position of 171,893 contracts, up 6,139 contracts which, was a partial offset. For meal, non-commercial traders were net long 5,749 contracts, a decrease of 18,263 contracts for the week. The aggressive selling trend is seen as a short-term negative force. Non-commercial and nonreportable combined traders held a net long position of 11,919 contracts, down 26,123 for the week. For soybean oil, non-commercial traders were net long 23,323 contracts, a decrease of 14,802 contracts for the week. Commodity index traders held a net long position of 79,804 contracts, down 1,325. The weather seemed to be good enough last week to see crop conditions improve by 1-2% in the good to excellent categories for this afternoon's update.
