July soybeans were trading 15 1/2 cents higher near 7:30 cst. China futures closed up 0.7% after a 1% jump the previous session and Palm oil futures in Malaysia were up 1.3%. Hong Kong shares managed more short covering gains overnight, while Shanghai equities simply marked time again on the charts. European equity markets were higher overnight off hopes of something positive from the ECB meeting early this morning. Early US equity market action was posting definitive gains, as there are expectations of central bank assistance in the air. Seeing a downward revision in Euro zone GDP readings overnight probably increased the hope of easing from the ECB. The US economic report slate today is rather thin, with a weekly mortgage application survey due out early, a couple Fed speeches due out during market hours and a Fed Beige Book scheduled for release in the early US afternoon trade. In general, there appears to be an attempt to fan risk-on sentiment but the question is whether or not the ECB meeting will contribute to that theme or detract from that theme. Lifting the weight of bearish outside market forces has helped to support the soybean market overnight. A strong tone to the cash markets and continued firm demand for meal continue to support the market off of last week's lows. The updated weather outlook calls for some rain in the 6-10 day period across the Midwest but not too organized and parts of the central and southwestern Corn Belt could be under some dryness stress into mid-June. The 11-15 day models have turned hotter and precipitation seems to be limited except for the northern Midwest. With top soil and subsoil dryness already, the outlook does not look to promising for erasing the dryness issues. July soybeans closed moderately higher on the session yesterday with gains of near 12 1/2 cents while November soybeans were up near 6 cents late. Meal gained sharply on oil and led the complex higher. Outside markets turned more positive and traders see strong demand and tightening ending stocks ahead which helped support the old crop contracts. Traders also see net drying down of the crop over the next few weeks which supported the new crop. Private forecast from Oil World show very strong export demand from the US for soybeans for the September to February time frame and tight March 1st stocks in the US. Mostly dry weather for the next week with some uncertainty for how much rain might hit the Midwest next week has kept the weather outlook slightly supportive for soybeans. July soybean oil closed slightly higher with an inside trading day after moving to the lowest level since October 2010 Monday while July meal managed a push to a 3-session high into the mid-day before backing off into the close. Weakness in wheat and new crop corn helped to limit the advance. Argentina farmers are on strike for the next week over high taxes. Malaysia palm oil production is expected to pick up over the next few months and is trading at a huge $120/tonne discount to Argentina soybean oil which is wider than normal.
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