Commentary
Soybeans continued their sharp reversal off lows, with futures gaining $2 from low to high over the last six days, the biggest weekly rally since 2004. The November contract finished 28 cents higher, with some profit taking the second half of the session. The USDA reported a private sale of 132K MT of beans for delivery to “unknown” destinations during the 22/23 marketing year. Keep in mind that USDA’s August yield estimate is based on its farmer survey, satellite data and modeling. Actual field surveys are not taken into consideration until September, which is when I expect the Trade to get its first handle on the impact of the anticipated August weather pattern. Prior to that the forecasts need to verify for the first 10 to 14 days for August or we could see a reversal in prices in my opinion. Currently, the National Weather Service has much of the Midwest to be hotter than normal through the first half of August, with limited rainfall chances in many areas. The “most important part” of the next 10 days is the “lack of significant moisture advertised by most of the computer forecast models from Iowa, northwestern Illinois and northern Missouri northwestward into the northern Plains,” said the NWS earlier today. Watch the Sunday night open for near term direction into next week. The USDA WASDE report is not released until Friday August 12th, so in my opinion the pricing influence will for the most part be all about weather for the next two weeks, which should be no surprise given we are entering into August.
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