July soybeans were trading 11 3/4 cents lower near 7:30 cst. China futures closed up 0.3% and up for the third session in a row while Palm oil futures fell 2.1% breaking a 4-session winning streak. Chinese stocks resumed a downward pattern overnight as recent Chinese stimulus hopes were reduced once again by regional media sources. Not surprisingly, European equity markets also resumed a downward march as Euro zone concerns were present again in the facing of rising Italian and Spanish debt yields. Some of the European equity market weakness overnight might also have been the result of the dampened Chinese stimulus talk. The US markets were showing moderate losses in the wake of the latest up tick in Italian and Spanish debt yields, as the pace of the US economy isn't thought to be strong enough right now to stand up to ongoing Euro zone and Chinese slowing threats. The US economic report slate today has pending home sales and an On-Line Help wanted index report but neither of those reports is expected to promote a return to a risk-on vibe. With a bearish tilt to outside market forces, rain in the forecast and fears that fund traders will be exiting long July soybean positions in the next few weeks, the market pushed lower overnight and below yesterday's lows. The weekly Soybeans Planting report showed a record fast pace with 89% of the crop is planted compared to 76% last week and 48% last year. The 10 year average for this time of year is 64%. The previous highest percent complete was 83% in 2000. Double-cropped soybeans could also get in early with winter wheat running about 2-3 weeks ahead of normal. July soybeans saw early gains yesterday and a run to 1402 before closing just slightly higher on the day at 1386 3/4. Outside market forces were consider more of a positive force yesterday than the short-term weather outlook which calls for cooler weather and 1/2 to 1 inch of rain for more than 70% of the Midwest over the next 3-4 days. The rain forecast in the US plus what appears to be better weather in the forecast for both Russia and China over the near-term is helping to pressure the other grains and this helped to limit the buying support and also helped spark a sharp set-back off of the early highs. Bearish outside forces overnight leaves July soybeans technically weak and vulnerable to another swing down to 1331 1/2 before finding much support. Private forecasters continue to see tightening old crop ending stocks as both crush and export demand has been better than expected. Weekly export inspections came in at 12.4 million bushels. Exports need to average 11.8 million bushels per week to reach the USDA projection for the year. Traders see the short-term weather as a negative force but a shift back to a warmer and drier than normal pattern for the 11-15 day forecast models has helped to provide some support. The National Grain and Oils Information Centre in China reported that soybean stocks at ports totaled 6.3 million tonnes, up 700,000 from a month ago.
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