Brazil officials raised their soybean production forecast to 103.8 million tonnes which is up from the USDA forecast of 102 million tonnes, and this helped to ease supply concerns overnight but the number is right on trade expectation. Their previous estimate came in at 102.45 million tonnes compared to last year’s production of 95.43 million. Late in the session buying from index re balancing gave the market a boost yesterday. Talk of buying interest from Chinese crushers of South American and US origin soybeans also supported price action yesterday, but some still fear more potential cancellations if south American weather cooperates and produces a combined crop equal to 159 million tonnes or larger. The market continues to hold support around 992 for March soybeans but remains below the downtrend line coming in at 1016 today. Until South American soybean production can be quantified, the market may trend sideways. Rallies will be sold by US traders as they see US ending stocks doubling last year’s total, and Chinese buying interest will focus on South American supplies. March soybean resistance comes in today at 1016 and 984 is still the downside target is support gives way.
Series 3 Licensed
Senior Market Strategist
Jeff studied finance at the University of Wisconsin-Madison and at Loyola University. He left the corporate world in 1995 to pursue his dream of working in the financial markets. Jeff's trading career began as a clerk in the S&P 500 pit at the Chicago Mercantile Exchange. This is where he developed a great interest in the options market that led him to the retail futures business. Jeff spent a few years as a broker's assistant before managing clients of his own.