On the Chicago Stock Exchange, soybeans rose sharply driven by the reduction in global ending stocks, while May returned above $14/bu, according to information released by TF Agroeconomia. “The January 22 soybean contract closed up 0.82% or $11.25 cents/bushel at $1388.0; the May22 contract, important for Brazilian exports, also closed up 0.86% or $12.25 cents/bushel at $1407.75. March soybean meal contract up 0.63% or $2.6/t short to $415.7 and March soybean oil contract closed up 0.82% or $0.48 /lb at $59.35,” he says.
“The market validated a new high, in the face of a USDA report that indicated a cut in production in Argentina and Brazil greater than expected by private companies. Thus, the world would move towards a season with lower ending stocks. Oil extending the rally and the weakening dollar added momentum.”
The US Department of Agriculture (USDA) raised the average spot price for soybeans by 50 cents to $12.60. “Soybean meal prices are being negotiated from R$1.90 to R$2.40 in black at noon. The average spot price of soybean meal was R$45 higher than R$375/ton. The USDA left the spot price for soybean oil at 65 cents/lb as the board is working 4 to 10 points weaker by midday. The USDA reported a large sale of new crop soybeans to China this morning for 132,000 tonnes,” he says.
“Soybean inventories on December 1st were at 3,149 bbu (85.70 MT) when the market expected to see 3,127 bbu (85.10 MT). This implied a Q1 usage of 1,543 bbu (41.99MT), when again the implied pre-report average market guess was 1,563 (42.54MT),” he concludes.