November soybeans were down 5 cents late in the overnight session. Malaysia palm futures closed 0.6% lower on the session but up nearly 2% for the month. China soybean futures closed slightly higher. Outside market forces look weak today as a lack of progress in Washington yesterday was seen as a mostly negative force for commodity markets and the US dollar is stronger. Meal deliveries against the August contract this morning came in at just 3 loads as compared with trade expectations for 300-500. Oil deliveries totaled 1,324 contracts against expectations for 3,000-5,000 and there were no deliveries for first notice day for August soybeans. Uncertainty for the impact on the debt ceiling impasse plus a more negative weather outlook for the next few weeks helped to pressure the market overnight. Harsh weather in July helped to support speculative buying in the soybean complex but while temperatures remain above average for the southern growing areas, most of the Midwest is expected to get rain in the next few weeks with increased chances for Wednesday to Friday next week and temperatures look normal for the Midwest into the second week of August. The weather outlook plus uncertainty for China import demand plus poor crushing margins are all seen as negative short-term forces. November soybeans closed moderately lower on the session yesterday and closed near the lows of the day and also experienced the lowest close since July 12th. The outlook for less heat and some rains for the dry areas of the Midwest and delta over the next week helped to trigger the early selling pressures as traders are beginning to see the possibility that crop conditions improve into early August. A firm US dollar and weakness in the metal markets added to the negative tone. Demand news was also seen as negative as weekly export sales news was slow and monthly crush came in near trade expectations at 124.32 million bushels. Traders were looking for crush near 125 million as compared with the May crush of 128.04 million bushels and the June 2010 crush of 129.17 million bushels. Even with the lower crush, soybean oil stocks came in above trade expectations at 3.114 billion pounds. Oil yields where sharply higher this year as compared with June of 2010. Soybeans sales came in at 10,500 tonnes for old crop and 362,200 for new crop for a total of 372,700 which was well below trade expectations. Cumulative new crop soybean sales stand at 21.7% of the USDA forecast versus a 5 year average of 16.9%. New crop sales of 547,000 metric tonnes are needed each week to reach the USDA forecast. Meal sales came in at 94,700 tonnes which was in line with trade expectations and oil sales came in at 11,600 tonnes, also in line with trade expectations.
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