Position Squaring Lifts Soybean Oil Ahead of USDA Data

Technically driven buying and short-covering ahead of the United States Department of Agriculture’s (USDA’s) monthly World Agricultural Supply and Demand Estimates (WASDE) report, scheduled for release Thursday at 11 a.m. (CST), lifted prices in the soybean complex on Wednesday. Steady palm oil prices overnight reduced the premium for palm oil futures relative to soybean oil, but the spread remains just above the recent life-of-contract low. West Texas Intermediate (WTI) futures ended the day close to unchanged. Still, after sharply dropping after the weekly inventory data release, the rally back to unchanged may have provided limited support for soybean oil.

Traders expect USDA’s report to be mildly bullish for the soybean complex. Surveys suggest modest reductions in USDA’s projection of…