Soybean Report, 02/19/2016

Friday, February 19, 2016

Mixed trade overnight leads us to the final session before the weekend. Net cancellations for China on beans IF you consider all the unknown cancellations as theirs by almost a 2:1 rate. Loadings to China were good the last week at over 1 MMT. Meal sales are similar with positive total exports, but China absent to negative depending on the unknown destination. The whole complex did see in range sales according to projections. SA will continue to pressure this report toward minimal numbers as we move forward. The front end spread is relaxing a bit and now 3 or better on carry. However, until the farmer flushes his inventory, forward months are still in a minimalist mentality regarding carry. The US$ is above 97, so the 96-98 range seems to be re-establishing itself. SA currencies are still weak and exports there are benefiting. Talking about SA, IF you are feeling an economic pinch think about this tidbit out of Venezuela, last year’s inflation rate was 181% and yesterday they announced a 6200% increase in the price of gasoline. OI on beans took a big hit yesterday as we continue to some profit taking apparently. Same goes for oil that feels a bit weaker again today. Some technical damage is occurring in the oil charts. Option expiration today should gravitate to the 880 area as it has the most total OI of Calls and Puts, but 900 isn’t too far behind mainly due to a larger Call population. Look for two sided trade early and outside markets to be a deciding factor heading into the close.

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