January soybeans were up 7 3/4 cents late in the overnight session. China futures closed up 0.3% overnight and Malaysia palm oil futures were up as much as 2.3% overnight before a slight pullback from the highs into the close. While equity markets in Asia were mixed during overnight trading, stock indices in Europe are generally higher and early indications are that US equity markets will open with strong gains. The US Dollar is moderately weaker against most of the major currencies. German Chancellor Merkel and French President Sarkozy will meet today to discuss ideas for EU fiscal integration. The Italian government announced 30 billion Euros of new austerity measures over the weekend. Euro zone Retail Sales during October were up 0.4%, higher than projections. A private survey of Euro zone service industries during November was at 47.0, slightly lower than expectations. A private survey of German service industries during November was at 50.3, lower than forecasts. Major US economic numbers to be released this morning include October Factory Orders and a private survey of non-Manufacturing industries at 9:00 AM. Meal deliveries this morning were 239 contracts (564 for month) and oil deliveries were 1,191 (6120 for month). A positive tilt to outside market forces plus optimism in Europe over an eventual end to the short-term debt crisis has helped to support the bounce overnight. In addition, traders are growing a bit more concerned with the lack of moisture for key growing areas in southern Brazil and Argentina. Some rain is in the forecast for early next week but the region is dry this week but temperatures are normal or below normal. Other areas of northern Brazil look good and traders will monitor this situation closely. On top of South America weather concerns, too much rain hit Malaysia over the weekend bringing back fears of slower production and this helped support the very strong palm oil trade over the weekend. The very weak start to the soybean export season in the US plus the outlook for good crops in South America which could keep their exports strong is still seen as a primary negative force. Many traders will be looking for lower exports and higher ending stocks for the USDA supply/demand update on Friday. January soybeans closed 7 3/4 cents higher on the session Friday and managed to gain 29 1/4 cents for the week. The early rally pushed the market up just shy of Wednesday's and last week's highs but a shift from lower to higher in the US dollar helped to spark the set-back off of the highs. January soybean oil pushed higher and to the highest level since November 23rd while meal inched higher but stayed inside of Thursday's range and pushed lower on the session late in the day. Weakness in corn and ideas that livestock producers are using less meal and more wheat in rations has been seen as a limiting factor for meal. The Commitments of Traders reports as of November 29th for soybeans showed non-Commercial traders were net long 9,609 contracts, an increase of 1,676 contracts for the week. Non-Commercial and nonreportable combined traders held a net short position of 27,155 contracts, a decrease of 5,431 contracts for the week and the short-covering trend is somewhat positive. Commodity Index traders held a net long position of 160,889 contracts, down 1,116 for the week. For meal, non-Commercial traders were net short 29,775 contracts, a decrease of 3,077 contracts for the week. The nonreportable traders were net short a record 2,485 contracts, an increase of 1,758 for the week. Non-Commercial and Nonreportable combined traders held a net short position of 32,260 contracts. For Soybean Oil, non-commercial traders were net short 18,359 contracts, a decrease of 2,153 for the week and the short-covering trend is a bit positive. Non-Commercial and Nonreportable combined traders held a net short position of 26,513 contracts. Commodity Index traders held a net long position of 88,781 contracts, up 690.
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