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Commentary
Beans drifted lower for a second straight day to end a wild month. We closed last year at 1010. Five percent higher on year is 1061 and while we have traded above that level numerous times, we haven’t seen the market able to run to the 11.00 handle. Lack of demand since the Brazilian harvest started in February has taken away old crop demand and now Argentina harvests big crops. Old crop prices while firm are now largely range bound between 10.00 and 10.60. While all the talking heads talk about lack of demand into China among a myriad of commodities, the market saw a flash sale announcement of 110,000 metric tons of soybeans for delivery to unknown destinations during the 2024/2025 marketing year yesterday despite the trade war. The last leg higher in beans from the recent low of 969 on the continuous chart to 1067 came on multiple fronts. First bean oil traded to new highs amid continued strong demand and potential guidance regarding increasing domestic usage of bean oil in the US. Beans also in my view followed corn higher after the April WASDE as old crop bushels were trimmed another 100 million corn bushels. Lastly, there has been a lot of rumors swirling of new demand from non-traditional buyers buying US origin from newly proposed trade deals. These rumors were one of the reasons that flipped funds from short to long for now. Moving forward, the market will look to tomorrows crush numbers. USDA March total soybean crush is expected to come in at 205.5 million bushels tomorrow morning, up from 189.0 million bushels in February and 203.5 million bushels in March 2024. Trade estimates range from 202.0207.5 million bushels. It’s important to note, the Rosario Grains Exchange said that Argentine farmers sold 230k tonnes of soybeans yesterday, the largest single-day number registered so far in 2025. If we see more of this type of selling, it could pressure old crop, and push funds that are long approximately 55K long to a neutral or small net short position. Technical levels for the remainder of the week come in as follows. Support is 1039.4 (50 week moving average). A close under and it’s the 21-week moving average at 1025.0. A close under there and its 1010.0 and major support at 9.98. Resistance is the aforementioned 1061/64 area. A close above there and its 10.76. If we close above these three areas, next resistance is the trendline at 1091.0 and then 1110, (10% higher on year). In the current environment I think one avoids the noise and trades the chart.
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Sean Lusk
Vice President Commercial Hedging Division
Walsh Trading
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