Price action: November soybeans rose 8 cents to $13.33 1/4, gaining a paltry 1 1/2 cents on the week. September soymeal fell $4.50 to $422.60, losing $1.20 week-over-week, while September soyoil gained 135 points to 65.39 cents, and rose 220 points on the week.
5-day outlook: Soybeans were able to secure follow-through gains to end the week, along with an advanced technical posture, with a close held above the 40- and 200-day moving averages. Crude oil strength combined with a sinking U.S. dollar lent an edge to commodities, though weakness in meal futures likely capped gains in the soy complex. Over the next week, traders will remain tuned into any escalation in the Russia/Ukraine conflict and prepare for USDA’s World Agricultural Supply and Demand Estimates, due out Aug. 11. A particular focus will remain on yield adjustments following a large acreage reduction in USDA’s June Acreage Report as well as ending stocks.
30-day outlook: Weather will be a longer-term focus into September as the soybean crop progresses through its crucial growth phase. World Weather Inc. states today’s forecast is wetter than advertised earlier this week for the driest areas from eastern North Dakota to northwestern Minnesota and significant rain is expected there this weekend with eastern South Dakota and northeastern Nebraska to Wisconsin to Iowa seeing rain as well. The forecaster notes a close watch will be made on the rainfall distribution in east-central and northeastern North Dakota and nearby Minnesota where additional rains of significance are not expected until Aug 13-15. A lack of significant heat is expected to continue throughout the Midwest during at least the next ten days. However, while many areas across the Midwest will see improvements in yield potentials during the next two weeks to ten days, dry soils and periods of hot weather in June and July likely caused some declines in yields that will not be recovered.
90-day outlook: As the new marketing year approaches, traders will closely watch U.S. export sales to gauge overall demand and the global economy. A recent uptick in export sales has had marginal effects on futures, though persisting sales would help undergird the complex. In the week ended July 27, USDA reported net new crop sales of 2.631 MMT, which exceeded pre-report range of 1.0 to 2.5 MMT. Top purchasers during the week included 1.574 MMT to “unknown destinations” and 859,000 MT to China. Of additional importance in the coming days will be South American weather as farmers prepare to plant soybeans across Brazil and Argentina.
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