SOYBEAN HIGHLIGHTS: Soybean futures closed slightly higher on a very quiet day of trading, and both meal and bean oil closed lower. The biggest mover today was crude oil which fell over 2 dollars a barrel on fears of further rate hikes from the Federal Reserve. Mar soybeans gained 3/4 cent again to end the session at 15.27-1/4, and Nov gained 2-1/2 cents at 13.86-1/4.

Markets drifted around pretty listlessly today without much news to go on. Soybeans had very limited gains, while meal had small losses, but bean oil moved a bit lower as a result of the sell-off in crude. It has been seeming like the Fed is signaling that they will continue hiking interest rates to combat inflation and this fear caused a big jump in the dollar as well as the downturn in crude. Argentinian weather is a supportive factor as cool and dry conditions are forecast over the next 10 days and the crop is in desperate need of moisture. Crop conditions were significantly lowered by the Buenos Aires Grain Exchange yesterday as a result of the drought. In Brazil, things are going well and approximately 35 mmt of beans have already been harvested out of the estimated 153 mmt. While US exports are expected to drop of soon in favor of Brazil, the US is only 157 mb away from reaching the USDA’s export estimate for the marketing year. Domestic demand is helping keep prices stout, and based on the Mar futures, the value of crushed beans exceeds those of uncrushed by 3.48, incentivizing processors to continue buying cash. The trend for Mar remains higher with support near 15 dollars and resistance at 15.55.

SUMMARY: Trade ahead of this three-day weekend was extremely quiet and there was very little news for the market to go on. Beans were only slightly higher and there were modest losses for meal and bean oil. Beans remain in their upward trend and producers should look at making cash sales here for any old crop, as well as new, and put strategies in place to protect unpriced bushels.

SOYBEAN PRICING STRATEGY:

HEDGING: 2022: Hedged 20% Mar at 14.87-1/2. Hold. Exit on a close above 15.50. Recently hedged 15% Nov from 13.86 was exited at 14.55-1/2. Recently, 20% hedged Nov, 10% at 14.68-3/4, and 10% at 15.33-3/4 were exited at 13.83-3/4. 2023: 20% hedged: 10% at 14.00 and 10% at 13.74. Hold.

CASH ALERT: 2022: 75% sold. Sold 5% when futures closed below 15.35, filled near 15.25-3/4. Most recent sales sold 5% when Jan traded above 15.00, 5% at 14.00 Nov and 5% at 15.50 Nov. 2023: 30% sold. See Cash Tracker.

OPTIONS: 2022: On 20% sold Mar 15.30 calls at 20 cents. Hold. LTD is 02/24/2023. Recently, on 20% sold Jan 15.00 calls at 25-0 cents expired without value in your favor. 2023: Aside. No positions or orders.

LEGEND of Moving Averages: Pink 10-day, Purple 20-day, Blue 40-day, Green 50-day, Red 100-day, Dark Blue 200-day.

Author

Carol Tillmann