Afternoon Soybeans: Board crush margins slip 9 cents following census crush report.

The soybean market shrugged off modest overnight sell pressure to post a strong recovery trade with bull spread leadership that helped lift SK to a 21 higher settlement and SX 10 higher.  Overall, old crop beans continue to consolidate around either side of the $14 for now, finding limited follow through in either direction.  Fund selling had been a feature the past couple of sessions but was not a factor in today's trade.  

The market focus returned to Southern Hemisphere crops where forecasts for Argentina show a return to mostly dry and hot conditions for the next couple of weeks. Crop areas that have missed out on recent relief should see increasing crop stress during this stretch. March is the main pod filling month for Argentina's bean crop so the absence of moisture is not ideal - see US August 2020. Brazilian rains across the central to northern growing regions are forecast to continue with regularity - this pattern continues to slow soybean harvest and is causing some quality issues but the bigger impact is squarely on the Safrinha corn planting delays that have the potential to reduce production more significantly.

Beans also had a needed status reminder on domestic demand where yesterday afternoon's census crush report highlighted the fact that processor demand continued to run at a record pace through January with no signs of rationing taking place.

In the product trade, yesterday's crush data highlighted record processor demand but also featured sizeable product builds with oil stocks reaching an 8-month high and meal stocks reaching a multi-year high for a month end. This was reflected in today's price action where the products both closed in positive territory but could not keep up with the bean strength and board crush margins broke 8 cents to 62 cents/bushel. The meal performance was the more significant of the two technically with the reversal helping to sustain the broad sideways range pattern that was threatening to break down.

Elsewhere in the news, Cordonnier took his Brazil soybean production est. up 2 mmt to 132 mmt with a neutral to slightly higher bias going forward while leaving his corn est. unchanged at 105 mmt with a neutral bias. He left his Argy soy and corn production estimates unchanged at 46.0 mmt and 45.5 mmt respectively, with a neutral bias going forward.

Patria Agroegocios reports Brazil's soybean lineup waiting to load/ship has reached a record volume of 19 mmt due to harvest delays and strong demand for new crop supply.

Spread action:
• Soybean bull spreads firm.
• Board crush margins steady off 9 to 62 cents/bushel basis May.
• Oil share steady 37.0% basis May.
• New crop bean/corn ratio 2.58%.

Soybean Basis:
Location Spot
US Gulf off 6 to +69
Brazil Paranagua off 5 to +10
Cedar Rapids, IA steady -16k
Mankato, MN steady -5k
Decatur, IL steady +18k
Claypool, IN steady +40k
Columbus, OH steady +10k