Pre-Opening Soy Complex Market Report

November soybeans were down 9 1/4 cents late in the overnight session. China futures fell 0.7% overnight, and futures have closed lower for five sessions in a row. Palm oil futures in Malaysia closed down 0.95%. While equity markets in Asia were mixed during overnight trading, stock indices in Europe are generally weaker this morning. Early indications are that US equity markets will open with substantial losses. The US Dollar is stronger against most of the major currencies this morning, although posting a small loss versus the Yen. EU finance ministers met in Poland over the weekend but failed to come up with any new plan to stabilize Greece's finances. The Greek Prime Minister cancelled a visit to the US in order to have an emergency Cabinet meeting. The only major US economic numbers to be released this morning is a private survey of the US Housing. Weakness in energy markets and other agricultural markets are also seen as a negative influence on grains this morning. A long liquidation selling trend for soybeans from speculators and weakness in outside markets helped drive the market lower again overnight, with November soybeans moving down to the lowest level since August 16th and now down as much as $1.18 1/2 off of the August 31st peak. With economic concerns for Europe helping to keep the demand tone weak and with the US harvest picking up steam in the weeks just ahead, the market has seen speculative long liquidation selling. November soybeans closed 3 1/4 cents lower on the session Friday and down 71 1/4 cents for the week. Ideas that the market is a bit oversold short-term and that the USDA may revise harvested acres lower in the October update helped support the early rally on Friday, but there was no follow-through buying support. Weakness in outside market forces (the dollar and energy markets) and a long liquidation selling trend from fund traders helped to push the market moderately lower on the day into the mid-session. Talk that China is still buying soybeans from Argentina last week instead of a normal seasonal switch to the US at this time of the year helped to pressure. However, traders see improving demand from China and better crush margins in China as positive short-term factors. The market found some commercial buying support near the lows at 1350 on Friday and a short-covering trend emerged to pull the market up off of the lows to slightly higher on the day shortly before the close. December oil closed slightly higher on the day after a 4-day liquidation break, but the market pushed to a new low for the move in overnight action. The Commitments of Traders reports as of September 13th for soybeans showed non-commercial traders were net long 160,892 contracts, a decrease of 19,318 contracts for the week, and the fund selling trend is seen as a short-term negative force. Commodity index traders held a net long position of 164,719 contracts, down 2,409 for the week. For meal, non-commercial traders were net long 48,728 contracts, a decrease of 8,836 contracts for the week. Non-commercial and nonreportable traders combined held a net long position of 67,052 contracts, down 8,483. For oil, non-commercial traders were net long 42,613 contracts, a decrease of 1,272 contracts. Commodity index traders held a net long position of 76,909 contracts, up 1,782 contracts for the week. The US Soybean Export Council indicated over the weekend that Southeast Asia could double its soybean imports over the next 10 years due to rising demand from fish farms looking to feed China.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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