According to Angel Commodities, Soybean futures expected to trade sideways to higher in coming days on improving crushing demand on expectation on improving meal exports and lower soy oil imports.
Angel Commodities' report on Soybean
NCDEX Soybean edged higher on Wednesday to close at 3,793 rupees per 100 kg and climb to 5-week high due to improving demand on forecast on below normal rains in monsoon season by Skymet. Moreover, lower crude soybean oil stocks at port also support soybean prices. USDA in its monthly report forecast output at 109 lt in 2019/20, down 5% compared to last year. As SEA, soymeal exports are revised higher to 13.58 lt, up 14.3% in 2018/19. SEA revised March 2018 exports figures to 2.15 lt which is highest single month exports in last 26 months. As per latest SOPA press release, soybean arrivals for the Oct-Apr period pegged at 81 lt, up by 21.8% on year. Until April, country crushed about 62 lt of soybean compared to 55.5 lt last year for same period. As per SOPA, availability of soybean for crushing, direct use and exports of about 101.8 lt as against 86 lt last year.
CBOT Soybean edged higher on Wednesday mostly on bargain buying from 3-year low levels despite expectation of lower exports and higher planting area in the US. Currently, US raise tariffs on $200 billion of Chinese goods from 10% to 25% last Friday. Trade tensions are rising, as China plans to raise tariffs on $60 billion of US goods to counter the US hike from last week. According to USDA data, US soybean export down 5.3% m/m to 48.3 mt in 2018/19. Brazil will be largest soybean producing country in 2019/20 at 123 mt, up 5% on year.
Soybean futures expected to trade sideways to higher in coming days on improving crushing demand on expectation on improving meal exports and lower soy oil imports. However, higher production, forecast of normal monsoon and increase edible oil imports might put extra pressure on Oilseeds at higher levels.
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