Afternoon Soybeans: Beans and Meal shed some risk premium.

The soybean market went from trading modestly higher in the overnight session to selling off sharply during the day session.  The selling was focused on the front end of the curve after the bull spreads traded into a new high just yesterday but were liquidated today, particularly in the old to new crop spreads.  May beans settled 15 cents lower and broke down the extended trading range, falling to a three month low.  The new crop November futures settled 11 cents lower and established a new low close for its move.   Corn gained on beans for a seventh consecutive session which has narrowed the new crop ratio to 2.34% and off the recent high of 2.46%.  For the week, top step beans lost 36 ½ cents (SX lost 44), meal lost $32.8, and oil lost gained 1.35.  The cash markets remain quiet with minimal farmer selling taking place, domestic bean basis is steady/firm and CIF bean bids at the Gulf picked up another penny to +92.   

In the product trade, bean oil traded .27 lower with weakness across the global veg oil space and in crude oil helping pressure the market and slow the recovery for a moment. Bean oil managed to close .63 off the session low. The meal market however was the feature as it fell by $8 in what is now the most significant correction off a high ($32) that we have seen since this meal rally began with last fall's breakout. The oil share settled at a two-week high at 38.1%. Board crush margins were off by 6 cents to $1.81/bushel.

Argentina's weather forecast includes heavy rains early next week with a couple more rounds to follow through the end of the month as the broader La Nina weather pattern eases and dissipates. Improved conditions would be a positive step in stabilizing falling production ideas as we hit the stretch run of what has been a train wreck of a growing season for Argentina.

Brazil's lighter rainfall pattern expected from northern Rio Grande do Sul to southern Minas Gerais over the next ten days will be good for advancing soybean harvesting and late season Safrinha corn planting. Regular rains elsewhere will be supportive to crops but also will continue to slow bean harvest and planting at times.

The CFTC continues to catch up with their position data, the assumption is that this afternoon's scheduled report should now get us current. Yesterday, the COT report showed managed fund money through the trade week ending 3/7 had -47.5k corn (net long 21k), -8.9k srw (net short -100.6k), -10.7k hrw (net short 10.4k), +27.7k beans (net long 157.3k), +15.0k meal (net long 155k), and -7.5k oil (net long 20.5k).

Elsewhere in the news, Russian Ag Min reports gross harvest of main oilseeds last year reached a record 29.1 mmt, up 17% from 2021. It included 16.4 mmt of sunflower (+4.5%), 6.0 mmt of soybeans (+26%), and 4.5 mmt of rapeseed (+61.6%).

Brazil's National Energy Policy Council raised the country's mandatory blend of biodiesel in diesel from 10% to 12% starting in April. The council also proposed a gradual increase in the mixture over the next few years, with the level rising to 13% in 2024, 14% in 2025 and 15% in 2026.

Brazil's soybean harvest in the state of Rio Grande do Sul reached 1% compared to 10% this time last year and the five year average of 14%.

Soybean Basis:
Location Spot
US Gulf up 2 to +92
Sioux City, IA steady opt price k
Mankato, MN steady -35k
Decatur, IL steady +35k
Claypool, IN steady +20k
Columbus, OH steady -15n