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Commentary

Whether it was a cessation for 90 days with China that reduced tariffs while allowing for temporary trade to resume with China, or the results of the May WASDE, new crop November soybeans rallied over 25 cents today. The USDA came in with a production estimate of 4.331 billion and a range of 4.228-4.38 billion. Yield is estimated at 52.5 bushels/acre versus an estimate of 52.5 (range 51.2-53). 2024/25 yield was 50.7 bushels/acre. The U.S. soybean ending stocks estimate for 2025/26 came in at 295 million bushels, compared to 380 million expected (range 240-675 million). It is my opinion the report was friendly versus expectations. The report can be considered bullish in my opinion with lower-than-expected ending stocks for both old crop and new crop. Pullbacks should find support as ending stocks are now forecast to tighten significantly more than expected, with weather being an unknown. Along with the bullish optimism from trade talks this weekend, today's technical breakout to the upside has the possibility to extend in my view. I see futures testing 11.00 given ending stocks projected by USDA, until we get a more certain look at weather, and those certainties in regard to key yield development time are weeks away. Look to buy dips. I will be putting out trade suggestions later this week. 

Trade Ideas

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Risk/Reward

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Sean Lusk

Vice President Commercial Hedging Division

Walsh Trading

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