According to Angel Commodities, Soybean futures expected to trade sideways to higher due to improve demand for crushing.
Angel Commodities' report on Soybean
NCDEX Feb Soybean futures touched one year high levels but slipped due to profit booking at higher levels. Prices have moved more than 12% higher in Jan due to improving physical demand tracking higher exports of soybean meal. Moreover, end of Bhavantar scheme of MP and soybeans holdings by the bulk traders also support prices. As per SEA press release soymeal exports up by 42% on year in December to 240,530 tonnes. Moreover, meal exports are higher by 6% at 994,303 tonnes for the Apr- Dec period compared to last year. According to SOPA, soybean product exports falls in Oct-Dec quarter. USDA pegs soymeal production up 2.2% on month and 22% on year at 75 lakh tonnes in 2018/19 due to increase in crushing by 22% this season.
US markets were closed on Monday. CBOT Soybean futures continued to rise sharply on Friday morning over China trade optimism and dry weather conditions in Brazil. There is concerns about dryness in parts of Brazil with some forecasts calling for crop stress to expand after mid-month. The Wall Street Journal reported that the United States is considering lifting some or all tariffs imposed on China in a bid to hasten a trade deal between the world's two largest economies. AgRural cut their Brazil production estimate by 4.5 mt from November to 116.9 mt, due to hot and dry weather conditions in many parts of Brazil.
Outlook
Soybean futures expected to trade sideways to higher due to improve demand for crushing. Moreover, higher maize price is also supporting soybean prices as both are used as animal feed.
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