January soybeans were trading about 3 1/2 cents lower late in the overnight session. Palm oil futures in Malaysia were up as much as 4.9% during the trading session and closed up 2.6% after moving to the highest level since July of 2008. China futures were slightly higher for soybeans into the close with soybean oil up 1.2%. Outside market forces look mostly negative today with a strong US dollar and weakness for gold and energy markets. There were no deliveries for November soybeans this morning. January soybeans were up 48 cents last week and remain technically overbought basis traditional technical indicators and basis the record high net long position from funds traders seen in the weekly COT report. Traders see a positive tilt to the USDA Crop Production and Supply/demand reports for release before the opening on Tuesday. While traders see a revision higher in production of about 25-30 million bushels than last month due to better than expected yields, demand is also expected to be higher and traders see ending stocks down by about 20-25 million bushels from 265 million posted in the October report and from 350 million in the September report. Soybean oil was the clear leader to the upside for the soybean complex on Friday and for much of the week as traders see a tightening supply of vegetable oils on the world market this year and continued strong demand from India and China. Fears of global inflation and surging vegoil prices helped spark active buying on Friday and a move to the highest level since August of 2008 for nearby soybean oil futures. A surge higher in global vegetable oil prices and a limit-up advance from China futures markets for soybean oil and palm oil on Friday helped support strong gains in soybean oil. The higher US dollar after better than expected employment data news helped pressure some commodity markets while others see a strong US economy and better employment news as positive. Ideas that the strong export pace for soybeans will help force an adjustment higher in the US export outlook for Tuesday's reports and that this will more than offset any adjustment higher in production was seen as a supportive force. Cumulative soybean export sales stand at 69.9% of the USDA forecast for the entire season as compared with just 45.5% as the 5-year average for this time of the year. Weather was mostly favorable for planting and early growth in South America last week and some additional rains are in the forecast for some areas of Brazil early this week but traders are still concerned with a drier trend for parts of Argentina where hot and dry weather has stressed crops early and that this could spread to parts of Brazil. The Commitments of Traders reports as of November 2nd for Soybeans showed Non-Commercial traders were net long a new record high 192,481 contracts, up 3,608 contracts for the week. The Commercial traders were net short a new record 165,821 contracts. Non-Commercial and Nonreportable combined traders held a net long position of a new record high 165,821 contracts, up 6,655 for the week. The buying trend is seen as a short-term positive force. For Meal, Non-Commercial traders were net long 48,453 contracts, down 1,322 contracts for the week. Non-Commercial and Nonreportable combined traders held a net long position of 72,524 contracts, down 1,153 contracts for the week. The selling trend of the large trader is seen as a short-term negative force. For Soybean Oil, Non-Commercial traders were net long 74,760 contracts, a decrease of 3,287 contracts. The selling trend of the large trader is seen as a short-term negative force. Non-Commercial and Nonreportable combined traders held a net long position of 94,266 contracts, down 6,964 contracts for the week. Commodity Index traders held a net long position of 104,989 contracts, up 5,063 contracts for the week.
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