Soybean Analysis - 5-30-90 Day Outlooks (11/10/23)
Price action: November soybeans rose 4 cents to $13.47 1/2 but gave up 4 1/4 cents on the week. December meal fell 50 cents to $449.40 but rose $7.30 from a week-ago. December soyoil rose 75 points to 51.20 cents, which represented a 184-point week-over-week gain.
5-day outlook: Soybean futures seemingly stabilized today following Thursday’s post-report selloff, with support at the 100-day moving average curbing selling. Traders will continue to weigh USDA’s production estimates and monitor weather in Brazil. Earlier today, World Weather Inc. reported heat wave and low humidity warnings are currently in effect for northern Brazil crop areas and will likely be in effect most days for the next full week to nearly nine days. The forecaster notes the highest temps will occur in Brazil’s key center-west, center-south and northeastern crop areas, which have faced persistently dry conditions, delaying planting. Meanwhile, southern Paraguay into Rio Grande do Sul, southwestern Parana and Santa Catarina will see frequent rain through Nov. 18, stalling fieldwork, with more flooding likely in Rio Grande do Sul and Santa Catarina.
30-day outlook: As South America’s growing season progresses market participants will closely watch for potential changes in Brazil and Argentine production estimates. Crop consultant, Dr. Michael Cordonnier currently estimates Brazil’s soybean production will total 160 MMT but indicated a neutral to lower bias going forward. Cordonnier noted below normal rainfall during the growing season could still be enough to produce an average crop if the timing is right, however, central Brazil’s soils have poor water holding capacity and a week without rain during pod filling could result in moisture stress and reduced yield potential. Cordonnier estimates Argentina’s soybean crop at 50 MMT, with a neutral bias going forward amid improved weather over the past few weeks. On Thursday, the Buenos Aires Grains Exchange noted that producers could increase soybean plantings due to more favorable weather conditions, as rainfall arrived too late for earlier planted crops, such as corn and sunflowers in the north and western parts of the country.
90-day outlook: U.S. exports will serve as the long-term market focus as traders use the data to gauge demand and the global economy. This week, daily export sales gathered seasonal strength, with soybean sales totaling 2.852 MMT. Thursday’s daily sale of 1.044 MMT to China was the thirteenth largest ever, while the combined 662,500 MT to “unknown destinations,” also reported Thursday, constituted to seventh largest daily sale. Meanwhile, USDA reported net weekly sales of 1.08 MMT during week ended Nov. 2, which remained steady over the previous week, rising 7%.
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