18
Jan
From Van Trump today:
Soybeans struggle to find continued upside momentum. There’s very little fresh or new to report in regards to beans. Chinese demand remains in question, not only because of the current trade conflict, but also because the ongoing spread of African Swine Fever and the negative hog margins. Bullish Chinese soybean demand just isn’t in the headlines right now. U.S. demand remains strong but just not enough to carry the load, especially when we are talking a +900 million ending stock number. Bulls will argue that the USDA still needs to reduce their 2018 yield estimate and 2019 acres are going to be lower by perhaps -3 or -4 million acres. Regardless, without dramatically improved Chinese demand or a major U.S. weather story in 2019, it’s going to be tough to build continued momentum to the upside. Lets keep in mind, Brazil’s harvest is underway and new-crop bushels will soon become available in the global export marketplace. Despite some production concerns in parts of Argentina and Brazil, we still have most of the trade looking for substantially more production. Remember the USDA is currently forecasting Argentine production at 55.5 MMTs vs. 37.8 MMTs last year. From a technical perspective, the MAR19 contract is trading down near the lower end of the range. Tech guru’s argue that major support in the MAR19 contract lies in the area between $8.40 and $8.80 per bushel. To the upside, resistance remains in the $9.25 to $9.45 range. I suspect we trade inside the ranges mentioned above until more is known about Chinese trade and or weather worries become more widespread.