Commentary:
The soybeans have set back approximately thirty cents from the high. In the process the meal market flat price has continued to rise. In addition the meal spreads have gained a considerable amount. They are now at a good inverse. The global meal supply has tightened due to Brazilian crush slowing, the Argentinian currency, and US down time. The bean oil appears to have put in highs. This has allowed the crush margins to go from 36 percent down to 32 percent. The question going forward is how much more will China purchase from the US. The US bean offers are cheaper than South America through dec – jan period. This opens the door to more purchases. The question will remain how much more. The beans may attempt to retest the recent highs. It will take a real reason to take them out. This is due to the harvest rolling. The South American will plant a bit more beans this year. Perhaps even a lot more. This could come at the expense of feed grains. The corn is easing into the market here waiting for further purchases from China. The crop ratings stalled us out here. It is my belief the corn market will find support in here. It will probably need a reason to start another leg up. It is my thought that the corn is starting a longer term friendly move. This of course remains to be seen. Quantify your risk.
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NA today
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BE WELL,
John J. Walsh
President, Walsh Trading, Inc.
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