Thursday was a mixed day for our markets. Spot corn closed down 3/4, spot soybeans closed down 5 3/4, spot winter wheat closed unchanged and spot spring wheat closed up 3/4. In the overnight trade corn and winter wheat are negative, soybeans are positive and spring wheat is mixed. Oil closed up $1.77 yesterday at $57.76 per barrel. It is stronger in trading again this morning with it now valued at $58.18 per barrel. Our dollar has traded between a low of $0.720 US and a high of $0.722 US over the last 24 hours. This morning it is right in the middle of the range with it currently valued at $0.721 US.
Soybean prices pulled back yesterday and fell just below their 100 day moving average. This morning it has gained back those losses. It seems that traders are not willing to push prices either way by large amounts until the WASDE report next Monday. The wheat and corn markets both closed near even as the traders are treating them much like the soybean market.
Yesterday we listed most of the big items that the USDA could be adjusting which would affect the corn balance sheet. Today let’s take a look at the soybean balance sheet and what the USDA may adjust.
- They will announce the final yield for soybeans for last year. Not much of change is anticipated at this time but a small decrease seems to be possible.
- Similar to the yield not much of a change is expected with harvested acres.
- Exports will have to be decreased with the slow pace and decreased pace of exports so far this marketing year.
- Soybean crush amounts will likely be increased as monthly crush figures keep setting new records.
- Further to this it will be interesting to see if they adjust biodiesel requirements.
- What they do with both domestic and world demand for soybean meal and soybean oil could also have a major impact.
- Of course production levels for South America will most likely be increased with the continued favourable growing weather.
- Imports by China will also be under scrutiny. Any decrease will be seen as extremely bearish for prices going forward.
All in all this report has the potential to be a major market mover for the soybean market either way. What data the USDA decides to change with this report and how bearish or bullish they are with the data could affect soybean farmers for this coming crop year.
Friday’s thought: Never regret a day in your life: good days give happiness, bad days give experience, worst days give lessons, and best days give memories!
Delores Seiter | 613-880-7458
Bob Orr | 613-720-1271
Tony Mitchell | 613-227-2525
Office | 613-489-0956
