Soy Oil Continues Surge
The beans market witnessed a significant uptick on Friday as soy oil spearheaded a rally heading into the weekend with another triple-digit session. Beans closed 2 ¾ to 3 ¾ cents higher, resulting in May posting a 14 ¼ cents gain for the week, while Nov saw a 17 cents increase. Soy oil futures soared by 2% on Friday, ending the week more than 3 cents per pound higher. Soymeal futures, on the other hand, experienced losses, with May closing with a $6.70 deficit on the weekly chart.
CFTC Data Reveals Shifts
According to the latest weekly CFTC data, managed money traders engaged in short covering during the week ending on 3/12. This resulted in a reduction of 13k existing shorts and the addition of 3.8k new longs, bringing their net short position to 155k contracts. Commercial soybean hedgers, however, were on the opposite side, increasing their positions. The group added 26.5k new shorts and 9.3k new longs, leading to a 53k contract net long as of the Tuesday settle. Meanwhile, spec funds saw a significant change in soybean oil positions. With a notable shift during the week, they ended up being 33,410 contracts net short, having closed 15.9k existing shorts and added 13.2k new longs.
NOPA Report and USDA Estimate
Reports from NOPA members unveiled that February saw a record-breaking 186.2 mbu of crushing, surpassing expectations and marking a notable increase of 0.2% from January. Additionally, soy oil stocks spiked to 1.69 billion lbs compared to 1.51 billion in the previous month. On another front, USDA’s Ag Attache announced a reduction in the Argentina soy crop estimate to 49.5 MMT, impacting market sentiments with its latest projections.
Export Sales and Price Movements
The weekly Export Sales report divulged that 375,980 MT of soybeans were booked in the week ending on 3/7. While USDA reported season commitments at 1.457 bbu, reflecting a 20% lag behind last year’s pace. Presently, the WASDE balance sheet projects full-year exports to be 13.7% lower than the previous year’s total, indicating a cautious outlook for the market. The closing prices for May 24 Soybeans, Nearby Cash, Jul 24 Soybeans, and Nov 24 Soybeans on Friday represented a positive trend in prices, closing higher by a few cents each.
Insights and Disclaimer
Notably, Alan Brugler had no positions related to the securities mentioned. All information presented in this article is solely for informational purposes. Lastly, the views expressed here belong to the author and may not necessarily align with those of Nasdaq, Inc.
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