Afternoon Soybeans: Bean complex restructuring in price in anticipation of record SAM production.
<div class=\"default-font-wrapper\" style=\"line-height: 1;font-size: 12pt; font-family: Verdana, Geneva, sans-serif;\"><div style=\"line-height: 1;\"><span style=\"font-size: 12pt; font-family: Verdana, Geneva, sans-serif;\">The soybean market is accelerating to the downside and established fresh contract lows across the curve today. January beans settled 25 cents lower and is off from last week’s high by 62 cents. The nearby Jan-March spread remained firm and established a new high for its move at a 1.5 cent carry where the spread is reflecting solid nearby export demand. The old crop futures lost ground to the new crop. The new crop bean to corn ratio continued to fall and hit a new low at 2.23%. Domestic bean basis was steady to lower while CIF bean bids at the Gulf were steady.<br> <br>There wasn’t anything new around the market today but rather we are in the process of shifting the trade’s focus from post-harvest demand (which is slowing seasonally) that has helped to underpin the futures and looking ahead at the advancing SAM crops where record production is anticipated and will leave the world awash in soybeans. US soybean export sales remain active but will tail off once buyers have bridged their coverage gap to cheaper Brazilian new crop availability. Brazil’s harvest will ramp up in February with less than usual supply available in January due to the lack of early planting in September. Product weakness and cratering board crush margins are adding to negative soybean sentiment. The currency influence post-Fed announcement this afternoon contributed to our late session pressure as the dollar surged more than 50 pts higher around the close (now up over 100 pts to a new high) and the Brazilian real plunged to a new all-time low. Strength in the dollar makes our exports less competitive while weakness in the real futures encourages producer selling in that country where the currency move has cushioned some of the fall in prices on the board.<br> <br>The weather forecast for the Southern Hemisphere remains favorable for crops across most of Brazil. There will be some near term drying across portions of S Brazil, Argentina, and Uruguay which could lead to eventual crop stress. Rains are expected to return by later in the month and at this stage the level of concern for crops in these areas is on the low end of the scale. <br> <br>In the product trade, oil and meal were both pressured sharply lower. Bean oil settled 102 pts or 2.5% lower and had company in its sister veg oil markets where Malaysian palm oil settled -4.3%, EU rapeseed -3.1%, Canadian canola -1.3% as part of a broader liquidation. On its own merits, soybean oil continues to struggle with a lack of confidence due to uncertainty and absence of forward guidance on domestic biofuels tax credits. Soybean meal was unable to capitalize on its export sales announcement and lost $7.5 or 2.7% to a fresh contract low. The oil share spread was mixed. Board crush margins dropped another 4 cents nearby to 98 cents/bushel. <br> <br>For tomorrow’s weekly export sales report, the range of trade estimates on combined old/new crop corn sales is .800-1.7 mmt, wheat 225-600 tmt, beans .825-2.1 mmt, meal 150-400 tmt, and oil 5-75 tmt. <br> <br>Elsewhere in the news, USDA reported private sale of 120,000 mt of Soybean Meal to Colombia.<br> <br>Indonesia's plan to expand its biodiesel mandate from Jan. 1, which has fuelled concerns it could curb global palm oil supplies, looks increasingly likely to be implemented gradually, analysts said, as industry participants seek a phase-in period. Indonesia, the world's biggest producer and exporter of palm oil, plans to raise the mandatory mix of palm oil in biodiesel to 40% - called B40 - from 35%, a policy that has triggered a jump in palm futures and may pressure prices further in 2025.<br> <br>Soybean Basis: <br>Location Spot <br>US Gulf steady +91 <br>Cedar Rapids, IA off 5 to -15f<br>Mankato, MN steady -15f <br>Decatur, IL steady +5f <br>Decatur, IN steady +10f <br>Columbus, OH steady -15f </span></div></div>