Soybean commentary

Soy commentary: Beans extend near 10-wk high, basis steady

14 Feb 2018

Soybean futures extended near 10-week highs during trade on Wednesday, but the threat of Argentinian rains later this week was offset by a weaker dollar and pushed futures 5 cents higher to $10.16/bu.

Front month meal futures were flat on the day at around $366/st after rising 11% on the week.

The dollar got slightly weaker – falling 0.5% against a basket of currencies – which supported futures against the threat of farmer selling into higher prices.

In the physical market, basis bids for barges into the US Gulf were stable, with March delivery at 37 cents over March futures and April delivery 31 cents over May futures, although trade was heard quieter than on Tuesday.

Agricensus assessed the basis as unchanged, which left the flat price assessment rising by $2/mt to $389/mt for loading 21-42 days out.

In South America, the board rally over the past few days failed to bring out Brazilian sellers, who were back at work following a two-day national holiday for Carnival.

The paper market in Paranagua was bid at 56 cents for March and offered at 62 cents over March futures with April bid at 44 cents versus an offer of 49 cents over May futures.

With liquidity heard thin, Agricensus assessed March and April loading unchanged at 67 cents and 55 cents over March and May futures, respectively

That gave a spot price of $398/mt FOB Santos.

With China now out of the market, Agricensus assessed at a $1.56/bu premium over March futures, which was the last known trade and equated to $430.75/mt CIF.

Offers on a CIF AR basis were heard in the high teens and Agricensus assessed at $416/mt.

In other news, US agribusiness giant Bunge said it was paring back on take or pay contracts for beans in Brazil to give it “more flexibility”.