Soybean futures started this week with strong gains that eventually fizzled, as the market displayed classic “buy the rumour, sell the action” behaviour.
Traders initially pushed prices higher on optimism surrounding Chinese buying (and a strong October NOPA crush report), with the nearby January contract touching a 17-month high on Tuesday at just under $11.70/bu (see chart below).
But even as Chinese buying was confirmed as the week went on, doubts about whether Beijing would reach its expected 12 million tonnes in American soybean purchases by the end of this year helped to erase much of the early-week enthusiasm. Soybean futures were on track to settle little changed on Friday, with the January contract around $11.25.
According to reports, China booked more than 1.1 million tonnes of US soybeans this week with the total since the end of October now at 1.8 million.