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CBoT Soybean Ends Positive On Forecast Of Strong Global Oilseed Consumption

16 May 2020 8:03 am
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Mumbai (Commodities Control) - Soybeans closed with gains in the front months to go into the weekend. CBoT July Soybeans closed at $8.38 ½, up 1 ½ cents.

July soybeans were, however, down on the week 13 cents W/W. August Soybeans closed at $8.40 3/4, up 1 3/4 cents. September Soybeans closed at $8.41 ¼, up 1 ¾ cents and November Soybeans closed at $8.45 ½, up 1 ¾ cents.

Soybean meal futures closed 40 to 70 cents/ton lower. July Soybean Meal closed at $287.50, down $0.70. For the week, futures were down $3.40/ton W/W.

July Soybean Oil closed at $26.58, up $0.40. July soybean oil was still down on the week, 31 points lower from Fri to Fri.

NOPA crushers processed 171.75 million bu of beans in April. That was 1.27 million bu above the average estimate and 5.3% below March. It was a record for April, surpassing the previous record in ’18 by 6.7%. Soy oil stocks were above estimates with 2.11 billion lbs on hand. Crushers produced 4.05m tons of soymeal, which was up 8% YoY.

The weekly CoT report showed soybean speculative traders were 32,465 contracts net long as of May 12, which was their largest net long since November 5th 2019. Soymeal specs were still 11,127 contracts net short. Managed money traders were 7,865 contracts net short, after their open interest was up 6% on the week nearly even to both sides. Buenos Aires Grain Exchange reported Argentina’s soybean harvest was 87.4% complete on May 14.

Meanwhile as per USDA report, Global oilseed consumption is forecast to rise 2 percent in 2020/21, the strongest pace since 2017/18, reflecting slowly rebuilding feed demand in China following 2 years of declining pork production due to African Swine Fever. Soybean crush and consumption is projected to account for most of the growth in global oilseed use.

Global oilseed trade is forecast to increase mostly on higher soybean demand from China. Global ending stocks are projected to fall slightly, pulled down by lower soybean and peanut stocks.

Global oilseed production is forecast to grow 5 percent in 2020/21, primarily on a rebound in soybean output in the United States and South America. Global oilseed production is projected to reach a record 605.9 million tons on record plantings. Soybean production is forecast to rise 26.6 million tons to a record 362.8 million tons, less than 3 million tons above the previous record set in 2018/19.

Global oilseed meal production is expected to grow in 2020/21, driven by expanded soybean meal production. Global protein meal consumption is also forecast to rise, mainly driven by robust demand from China.

Support and Resistance for active contract lies at $8.32 and $8.45 per Bushel, respectively.

(Commodities Control Bureau)

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