Afternoon Soybeans: Beans bounced back from early morning pressure.
<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 had a low volume, two-sided trade that featured a firmer overnight, an early day-session low, and then a steady climb back into positive territory. Tariff uncertainty lingers in the background while SAM weather and export sales were at the forefront of today’s focus. March beans settled 3.5 cents higher and matched the gains in the new crop futures. <br> <br>SAM weather for the next two weeks remains far from ideal but the forecast offers some optimism with two rounds of rain next week for the dry central to northern Argentina crop areas although heat and dryness will stress crops in the meantime. Brazil will see alternating periods of rain and sunshine in the center west which will slow but not completely delay harvest/planting activity.<br> <br>Argentine crop conditions continue to deteriorate. The Buenos Aire Grain Exchange reported Argentina’s soybean crop rated 17% G/E and 32% P/VP compared to 20% G/E and 28% P/VP last week and 31% G/E and 19% P/VP a year ago. The corn crop was rated 25% G/E and 26% P/VP compared to 28% G/E and 22% P/VP last week and 63% G/E and 37% P/VP a year ago.<br> <br>Weekly soybean sales totaled just 388 tmt (14 mb) and sales continue to wind down seasonally as global buyers are holding off for cheaper Brazilian beans that are about to be harvested. With 30 weeks remaining in the marketing year, soybean sales would need to average 218 tmt or 8 mb per week to reach the USDA’s outlook. US beans at the Gulf are priced at a $25-$30/mt premium to Brazil and likely won’t be competitive again until our new crop. Even then, due to the size of Brazil’s crop (170+ mmt) they will be competing well into our normal demand window next fall. <br> <br>In the product trade, bean oil participated in the broader veg oil strength today led by rapeseed which gained 1.5% and reached a 2.5 month high. The bean oil gains were more modest at .31 pts, or .69%. Tomorrow’s Stats Can report is expected to show canola stocks at 11.85 mmt compared to 12.85 mmt a year ago. Bean oil export sales were a subdued 2 tmt but total commitments (shipped/sold) represent 92% of the USDA’s forecast for the marketing year with 34 weeks remaining. Meal export sales were a marketing year high at 531 tmt and reflect our improved competitive pricing posture following the extended decline of US values and some appreciation in SAM FOB values. Board crush margins slipped 4 cents lower to $1.13/bushel. <br> <br>Elsewhere in the news, Old crop bean sales of 388 tmt were down 12% from the previous week and 40% from the prior 4-week average. Exports of 1.193 mmt were down 62% from the previous week and 3% from the 4-week average. <br> <br>Marketing year to date, soybean sales plus shipments total 43.071 mmt (1.583 bb) which is 12% higher than last year’s pace. Total commitments represent 87% of the USDA’s projected total (49.67 mmt or 1.825 bb) for the year compared to the 5 year average for this date of 85%. With 30 weeks remaining in the marketing year, soybean sales would need to average 218 tmt or 8 mb per week to reach the USDA’s outlook. China holds 2.3 mmt in open bean commitments on the books, Mexico 1.3 mmt, Canada 5 tmt, and the EU 207 tmt.<br> <br>Old crop meal sales of 531 tmt--a marketing-year high-- were up 29% from the previous week and up noticeably from the prior 4-week average. Exports of 466,800 MT--a marketing-year high--were up noticeably from the previous week and from the prior 4-week average.<br> <br>Old crop bean oil sales of 2 tmt were down 82% from the previous week and 92% from the prior 4-week average. Exports of 48 tmt were down 54% from the previous week, but up 24% from the prior 4-week average. <br> <br>The USDA’s weekly drought update showed 46% of corn area in drought up from 42% a week ago and 27% a year ago. 37% of bean area in drought up from 35% a week ago and 27% a year ago. 23% of winter wheat area in drought down from 24% a week ago and up from 14% a year ago. <br> <br>Rosario Grain Exchange noted beneficial rains were recorded in the country's central farming regions yesterday and today. The exchange kept their 24/25 soybean and corn harvest estimates unchanged at 49.6 mln mt and 49.0 mln mt, respectively.<br> <br>World Trade Organization acknowledged China has begun a dispute resolution request over the latest US tariffs on imported goods from China. <br> <br>Ahead of tomorrow’s Stats Can stocks report, the average trade estimate on canola stocks is 11.85 mmt compared to 12.85 mmt a year ago. <br> <br>Ahead of next week's Malaysian Palm Oil Board January data release, analysts are forecasting palm oil production around 1.32 mln mt, exports in January at 1.15 mln mt. The production estimate is off -11% from December, and exports are seen off 14.6% from December. End of January palm oil stocks are forecast at 1.65 mln mt, if realized would be off -3.5% from the prior month. The data will be released Monday, Feb 10th.<br> <br>Soybean Basis: <br>Location Spot <br>US Gulf off 1 to +68 <br>Cedar Rapids, IA steady -35h<br>Mankato, MN steady -50h<br>Decatur, IL steady -15h<br>Decatur, IN steady opt price h <br>Columbus, OH steady -20h </span></div></div>