DTN Soybean Meal Six Factors

TREND: The trend in May soybean meal futures is sideways for now.

NONCOMMERCIAL OUTLOOK: Noncommercial soybean meal traders held a net-long futures position of 116,864 contracts as of April 7 and were net-sellers of 3,330 contracts of meal through the CFTC reporting period (Tuesday to Tuesday), taking profits on long positions amid improving soybean crop conditions in Argentina, and increasing tensions between the U.S. and Iran.

COMMERCIAL OUTLOOK: Commercial traders held a net-short position in soymeal futures of 137,109 contracts for the week ended April 7, buying 4,107 contracts through the CFTC reporting period. May meal is priced $4.00 higher than the July contract, a spread which firmed this week back towards its most inverted levels reached in March. Cash meal prices in Illinois are trading higher than the nearby futures board, combining with the inverted spread to indicate very strong demand for U.S. meal.

SEASONAL INDEX: Soybean meal prices tend to peak in early July and bottom in early October.

PRICE PROBABILITY: In the most recent week, most active (May) soybean meal futures rose 6 points to the 27th percentile, an impressive rally through the week but still within the lower third of observed prices in the past five years.

VOLATILITY: Three-month price volatility in most active (May) meal futures rose this week to 8%, with prices rallying sharply back towards March highs.