COMMENTARY:
SOY
BEANS – The beans continue under pressure. The USDA will release a report tomorrow. The supply side is expected to increase 50 million bushels. I will not be surprised to see a 70-90 million bu increase. This will put the carry close to 400 million bu as we enter the new year, if realized. I say if, as it is always difficult to predict the USDA. The South American planting is rolling along. This will continue at a decent clip with moisture levels more than ample. The weather window for problems will open as there is plenty of time in the growing season. However, at present there are little if any problems. IT is important to note as well that there are early beans that will be available in December. The US window is a much more narrow window than before. I believe beans will work lower.
MEAL – The meal closed moderately lower. There are a couple things to consider. The meal in my opinion will be a bit supported at this level, and a bit lower. I remain neutral. It is my belief, however, that meal is gaining on beans and oil. The fundamentals have become more supported. Look for breaks in the meal as buying opportunities.
BEAN OIL – The bean oil was under pressure. The market is looking for the report tomorrow. The important aspect of the veg oil market is the fact that the competitive oils are becoming more supplied. In addition, the slowing crush did not decrease stocks. Rather bean oil stocks are climbing a bit. I look for tomorrows report to increase beans a bit more than anticipated, ultimately weighing on bean oil further.
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BE WELL,
John J. Walsh
President, Walsh Trading, Inc.
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