Update from May 1oth Commodity Speculation Report for Soybean Oil.
Soybean oil futures continued to drift downwards last week, closing below the key support level of $0.37. The market still looks extremely “bearish,” continuing the slide that started during the middle of April.
Factors contributing to the expected downward trend in the market are:
Soybean oil futures continued to drift downwards last week, closing below the key support level of $0.37. The market still looks extremely “bearish,” continuing the slide that started during the middle of April.
Factors contributing to the expected downward trend in the market are:
- According to Refined Oils Weekly Wire, (published weekly by Bunge for its customers), “corn planting progress came in at 87% and beans at 38%, both still above average. Corn conditions came in as favorable, 57% of corn planted is in ‘good’ condition.”
- We have previously considered the potential effects of the biodiesel tax credit passing as a “bullish” factor, but according to Refined Oils Weekly Wire, it is looking less and less likely that it will happen before June, exerting potential downward pressure on the market.
- The outside markets have been under considerable pressure over the last week. The European economy continues to look “fragile,” adding pressure to the domestic US markets.
- According to Bunge, the agricultural markets have shown a downward trend in the last few weeks, together with most of the financial markets. “Bearish sentiment has been a consistent theme of late and as a result the markets (especially soybean oil) are much oversold. Thursday’s strong close in the face of outside market turmoil was a positive sign going forward.”
- Soybean oil exports out of the US into China are likely to increase as Argentina continues its’ dispute with China.
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