CNS Canada — Soybean futures at the Chicago Board of Trade look technically bearish, one U.S. analyst says, but spec-longs may keep support in the market.
Corn futures, meanwhile, are expected to continue in a rangebound trend.
“Corn is still basically in a trading range; it doesn’t excite people. Beans, they’re all over the place,” said Scott Capinegro of HighGround Trading Group in Chicago.
Soybean futures had been propped up by an announcement from the U.S. Environmental Protection Agency calling for increased biodiesel use in the U.S., which buoyed soy oil.
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Dry areas in Argentina, where producers are still planting soybeans, added to recent advances.
But after notching higher at the start of the week, soybeans lost ground, shedding two cents per bushel in the January contract in the week ending Wednesday (all figures US$).
“That’s not real good technical chart action. So I’m not a bean bull, Capinegro said.
Into the new year, he added, investors will be watching export demand, which it’s feared the country’s new president could put at risk.
China is the biggest buyer of soybeans, and U.S. president-elect Donald Trump has been vocal about being tough on trade with China.
Trump’s platform included bringing trade cases against China, his website said.
“He steps on their toes — and I think he’s going to try to put some pressure on them — the trade relations won’t be that great,” Capinegro said.
Favourable seeding conditions in Brazil could further pressure U.S. prices for the oilseed in coming sessions, he added.
On the other hand, the corn market is heavy and likely to stay at current levels, he said.
Corn’s March contract lost close to 11 cents per bushel in the week ending Wednesday.
“There’s a saying that ‘bulls get Thanksgiving and bears get Christmas,’ and right now that’s what seems like is going on.”
— Jade Markus writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.
