Afternoon Soybeans: Beans shake off cancellations.

The soybean market shook off news of a cancellation of a handful of cargoes of beans to China/unknown and kept up with the broader grain and energy complex rallies.  A bigger than expected August crush out of NOPA also helped to offset some of the sting of the cancellations.  November beans gained 12 cents on the day with the bull spreads helping to lead the flat price gains.  Cash markets were quiet with CIF bids steady at +72.  A number of processor bids are scheduled to weaken starting tomorrow for LH Sept.  

As bean harvest approaches, the market is turning its focus more and more to forward demand where sales commitments have been disappointing in volume despite regular export announcements. Bean sales to China have been down from last year's pace in part due to higher prices on the board and the high cost of freight which has buyers dragging their heels, also Brazil has more supply and is taking a larger share of the trade this year.

US new crop beans are the cheapest supply to China who has significant needs to cover yet for ONDJ. China has been active buying Brazilian beans this week as US export disruptions have caught them short-bought for a moment. Today's cancellations are most likely the result of those replacement cargoes bought out of Brazil.

Rains along the Gulf coast temporarily slowed the recovery of export loadings but the ports of Houston, Galveston, Freeport and Texas City have re-opened their vessel traffic. In the center Gulf, progress continues to be made in restoring exports after Hurricane Ida.

NOPA August Crush - better than expected at 158.84 mb compared to the trade expectation for 154.2 mb. Did Gulf export disruption divert some bushels to the processor? The avg. daily rate of crush for August went up to 5.12 mb/day from 5.00 mb/day in July snapping a four month decline. Oil stocks grew to 1.668 bln lbs vs. 1.555 bln lbs expected and 1.617 bln lbs in July thanks to the larger crush and lower implied use. Oil yields dipped to 11.79 lbs from 11.83 in July.

In the product trade, soybean oil extended its recovery rally with support from veg oil strength in canola and palm oil along with the sharp gains in crude oil following the bigger than expected drop in supply in today's EIA report. The NOPA oil stocks for August were 1.668 bln lbs which was 113 mln lbs above expectations and 51 mln lbs higher on the month. This caused the market to drop 40 pts initially midday but bean oil showed resiliency and rallied back to make fresh highs by the close.

Elsewhere in the news, BA Grain Exchange estimated Argentina's 21/22 corn production at 55 mmt vs. the USDA at 53 mmt and they see beans at 44 mmt well below the USDA at 52 mmt.


Soybean Basis:
Location Spot
US Gulf steady +72
Brazil Paranagua up 10 to +245x
Cedar Rapids, IA steady -40x, moves to -30x tomorrow
Mankato, MN steady -20x, moves to -25x tomorrow
Decatur, IL steady -10x
Claypool, IN off 15 to opt price x
Columbus, OH steady +20x, moves to -10x tomorrow