Soybean price trend

After a strong start of April for soybeans, the price of soybeans has recently started to decline as the weather has returned to being favorable and most farmers are putting crops in the ground that can be profitable this year. Brazil's harvest, which is currently at 80%, causes a temporary halt to the upward soybean trend. Argentina's agricultural condition is still not getting better.

The majority of the weather in the Midwestern United States is predicted to warm and dry up soon, prompting farmers to begin preparing planting fields. While several significant U.S. farms continue to face land preparation delays due to inclement weather and pressure from decreasing demand for soybean meal. Soybean oil prices stayed flat on the downside.

According to the USDA report, weekly soybean export inspections climbed but declined year on year for the week ending April 6. The majority of export destinations are still China and Germany. Soybean exports totaled 669,566 tons, 165,666 tons more than the previous week but 151,498 tons less than last year. The most recent inspection of soybeans for this marketing year is 46,132,515 tons, up from 45,031,020 tons the previous year.

California's two West Coast ports resumed agricultural exports after being temporarily closed owing to failed labor contract negotiations, which impacted earlier soybean shipments and exports from the US. Even if it was only a temporary closure, it has increased uncertainty in the US food supply chain.

Soybean futures contracts found more hedging on rising soybean prices and were more open on long positions. Meanwhile, efforts to renew the Black Sea Grain Initiative, or the deal inked between Russia and Ukraine for the safe shipment of grain and food from Ukrainian ports, which expired in March, are still unsuccessful. Last Friday, Russia threatened not to extend the agreement unless limits on Russian agricultural exports were relaxed, raising fears of a worldwide food crisis if negotiations failed.

The USDA's soybean supply and consumption predictions for 2022/23 remain unchanged from the previous month. Soybean and soybean meal prices are projected to level off. Meanwhile, soybean oil was predicted to run at 64.0 cents per pound, a 2 cent drop.

Meanwhile, global soybean demand and supply forecasts for 2022/23 predict output and export reductions. Lower harvests in Argentina and Uruguay are likely to reduce global soybean production by 5.5 million tons to 369.6 million tons, somewhat offset by greater output from Brazil. Due to hot and dry circumstances, Argentina's soybean production is predicted to fall by 6.0 million tons to 27.0 million tons. At the same time, Uruguay's output is predicted to fall by 0.9 million tons to 1.2 million tons due to fewer harvested areas, which would be offset by a 1.0 million ton increase in Brazilian output to 154.0 million tons.

Data for Technical Analysis (1H)

Resistance : 1512.96, 1513.20, 1513.58

Support : 1512.20, 1511.96, 1511.58          

1H Outlook

Source: Investing.com                             

Buy/Long 1 If the support at the price range 1509.20 - 1512.20 is touched, but the support at 1512.20 cannot be broken, the TP may be set around 1513.00 and the SL around 1507.00, or up to the risk appetite.

Buy/Long 2 If the resistance can be broken at the price range of 1512.96 - 1515.96, TP may be set around 1517.00 and SL around 1510.00, or up to the risk appetite.       

Sell/Short 1 If the resistance at the price range 1512.96 - 1515.96 is touched, but the resistance 1512.96 cannot be broken, the TP may be set around 1512.20 and the SL around 1518.00, or up to the risk appetite.

Sell/Short 2 If the support can be broken at the price range of 1509.20 - 1512.20, TP may be set around 1505.50 and SL around 1515.00, or up to the risk appetite.       

Pivot Points Apr 13, 2023 05:17AM GMT

Sources: Brownfield Ag News 1, Brownfield Ag News 2