Commentary
Geo-political risks with China and a possibly wetter August forecast in the Midwest put soybeans on the defensive today in my opinion. China is 60% of the world’s soybean trade and of the 90 million metric tons China imports, the US accounts for approximately around one/third of the business. Weather forecasts don’t appear to be as threatening as feared a week ago with cooler temps and increased rain chances entering into the Midwest. That said, crop scouts and Ag Weather sites still cite that there are Weather concerns remain for crops in Nebraska, South Dakota and neighboring states, which may limit further price downside. “Crop stress and declines in yield potentials may begin expand into a larger part of the Midwest during the second half of August if rain does not increase,” according to the National Weather Service. Private surveys are starting to appear with guesses on soybean and corn yield. The survey that matters though will be the USDAs WASDE report on August 12th at 11am. Technically, I have support for November soybeans at 1349 (bottom of gap), then 1339. A close under sends the market to 1320, then 1282. Resistance in my opinion is up at 1380, then 14.06. A close above in my view sends the market to 14.52.
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