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Soybeans Close Higher Friday Amid Bargain Hunting

Recent Price Drop Attracts End-Users, Speculative Investors

Soybean futures closed higher on Friday as bargain hunters sought cheap contracts, while corn finished unchanged. 

Bean prices this week fell to the lowest in almost a decade amid an ongoing trade spat with China. End users and speculative investors, however, are snapping up cheap supplies as they await further news from the trade front. 

A declining dollar also helped move prices higher as a weaker greenback makes U.S. supplies more attractive to overseas buyers. The dollar fell 0.4% on Friday. 

November soybean futures closed up 16¢ to $8.96½ a bushel Friday on the Chicago Board of Trade. Soymeal rose $8.10 to $339.90 a short ton, and soy oil gained 0.04¢ to 29.23¢ a pound. 

Corn for July delivery was unchanged at $3.57 a bushel.

Chicago wheat fell 4¾¢ to $5.03¼ a bushel, while Kansas City futures lost 6¾¢ to $5.03¼ a bushel. 

In the outside markets, the NYMEX crude oil market jumped $3.31, or 5.1%, to $68.85 a barrel, while Brent futures added $2.37, or 3.2%, to $75.42. The U.S. dollar fell 0.4%, and the Dow Jones Industrials was 174  points higher.

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Thursday’s Grain Market Review

DES MOINES, Iowa -- On Thursday, the CME Group’s farm markets ended mostly higher, with the exception of soybeans giving up a dime.

At the close, the July corn futures settled 3¼¢ higher at $3.57½. December futures ended 2¾¢ higher at $3.78½.

July soybean futures ended 10¢ lower at $8.79. November soybean futures settled 10¼¢ lower at $9.00.

July wheat futures closed 8¢ higher at $5.07.

July soy meal futures closed $1.70 per short ton lower at $331.50. July soy oil futures closed 0.14¢ lower at 29.23¢ per pound. 

In the outside markets, the NYMEX crude oil market is $0.26 higher, the U.S. dollar is lower, and the Dow Jones Industrials are 137 points lower.

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Wednesday’s Grain Market Review

On Wednesday, the farm markets turned the heavy bearish winds around, finishing slightly higher.

At the close, the July corn futures finished ½¢ higher at $3.54¼. December futures finished ¼¢ higher at $3.75¾.

July soybean futures ended ½¢ higher at $8.89½. November soybean futures closed ½¢ lower at $9.10½.

July wheat futures settled 9¾¢ higher at $4.99¼.

July soy meal futures closed $1.30 per short ton lower at $333.20. July soy oil futures finished 0.52¢ higher at 29.37¢ per pound. 

In the outside markets, the NYMEX crude oil market is $1.15 higher, the U.S. dollar is higher, and the Dow Jones Industrials are 3 points lower.

Al Kluis, Kluis Advisors, says that news stories continue to favor the bears.

“If we continue to get bearish news but prices do not head lower, then many traders will view this as the first step of marking a major low,” Kluis stated in a daily note to customers Wednesday.

Kluis added that the grains have been on a true roller-coaster.

“On Tuesday, the July soybean contract had a 64¢ range while corn had a 19¢ range. Soybeans ended the day down 19 while corn was down 2¢. The wild swing sure feels like the market has reached capitulation. That means we had a big spike in volume while prices traded wildly during the day, but came back to end the day considerably better than the low. The panic selling seen on Tuesday may have been what the market needed to establish a major low.”

On Wednesday, the U.S. weekly ethanol output is on the rise, according to a Renewable Fuels Association press release.

According to EIA data analyzed by the Renewable Fuels Association, ethanol production averaged 1.064 million barrels per day (b/d)—or 44.69 million gallons daily. Output expanded 11,000 b/d from the prior week to yield a 17-week high. The four-week average for ethanol production swelled to the 19-week high of 1.050 million b/d for an annualized rate of 16.10 billion gallons, the release stated.
 
Stocks of ethanol were 21.6 million barrels. That is a 2.7% decline from last week.
 
There were zero imports recorded for the 28th week in a row, according to the RFA release.

 

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Tuesday’s Grain Market Review

On Tuesday, the CME Group’s farm markets drop double digits, with soybeans hitting a two-year low.

The pressure is coming from President Trump’s war of words and his slapping another $200 billion of tariffs on Chinese goods imported into the U.S.

At the close, July corn futures finished 2¼¢ lower at $3.53¾; December futures finished 1¾¢ lower at $3.75½.

July soybean futures ended 19½¢ lower at $8.89; November soybean futures closed 20½¢ lower at $9.11.

July wheat futures finished 12¼¢ lower at $4.77¾.

July soy meal futures settled $1 per short ton lower at $334.50. July soy oil futures closed 0.72¢ lower at 28.85¢ per pound. 

In the outside markets, the NYMEX crude oil market is 77¢ lower, the U.S. dollar is higher, and the Dow Jones Industrials are 268 points lower.

Al Kluis, Kluis Advisors, says the markets are not taking the trade tariff talks very well.

“Trade uncertainty with China and nonthreatening weather forecasts continue to put pressure on grain prices,” Kluis stated Tuesday in a note to customers.

He added, “Will the collapse in the global stock and commodity markets force some type of trade negotiations to start again?”

Jason Roose, U.S. Commodities, says the farm markets have a lot of downward momentum.

“Grains continue to be in a liquidation phase, hitting new contract lows in corn and soybeans. Nonthreatening weather and uncertainties with China trade negotiations have been the main fundamental factors that have all grains searching for near-term support in a technical oversold market,” Roose says.

 

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Monday’s Grain Market Review

On Monday, the CME Group’s farm markets trim losses.

At the close, July corn futures finished 5¢ lower at $3.56; December futures finished 5¢ lower at $3.77.

July soybean futures closed 3¢ higher at $9.08; November soybean futures settled 1¢ higher at $9.31.

July wheat futures ended 9¢ lower at $4.90.

July soy meal futures closed $3.40 per short ton lower at $335.50. July soy oil futures settled 0.07¢ higher at 29.57¢ per pound. 

In the outside markets, the NYMEX crude oil market is 71¢ higher, the U.S. dollar is lower, and the Dow Jones Industrials are 119 points lower.

Jack Scoville, PRICE Futures Group’s senior market analyst, says investors are eyeing trade news.

“We are waiting, here, for news about the Chinese sanctions and also the weather. None of it is particularly bullish, as the heat will fade and we don’t want to buy, and it is cheap to sell. We will see what happens along with everyone else sitting on their hands,” Scoville says.

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