After an almost four-year low, soybeans continue their two-day gains today to 2 percent. The grain was supported by speculations of dry weather in the U.S. Midwest, as this has the potential to limit yields, reports Reuters. Stress is mitigated by further news that U.S. corn and soybean may receive below-average rainfall within the next ten days which, along with the dry heat, would make pod-setting soybeans difficult.
According to Reuters, although the price is still nearing its off contract lows, Chicago Board Of Trade November soybeans rose 0.3 percent to $10.79-1/4 a bushel, having firmed 1.8 percent on Wednesday.
"The market remains attentive to the weather conditions in order to confirm the currently adequate conditions for soybeans," Paris-based farm adviser Agritel said, according to BusinessWeek. "The models remain rather uncertain, with a possible return of dryness spurring on the prices of the entire soybean complex."
The U.S. Department of Agriculture expects that the domestic output of soybean will reach 3.8 billion bushels in the year that starts Sept. 1, pushing world inventories to record 85.31 million metric tons by the end of the season, according to BusinessWeek.
Some analysts believe that yesterday's oilseed's strength index at 29.3 is a signal that prices may increase, as it is below the 30 level.
Risk Disclosure
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.
