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Soybean Meal Trading
Soybean Meal Trading ExplainedEach bushel of soybeans produces about 48 pounds of soybean meal and 11 pounds of soybean oil so the soybean meal market is often closely tied with developments in the soybean market when external factors come into play.
Soybean meal is the dominant protein supplement used in livestock and poultry feeds so herd and flock numbers are major influences on soybean meal consumption and prices. Soy products are also used to manufacture foodstuffs, diet-food products, beer and noodles. Technical uses include adhesives, cleansing materials, polyesters and other textiles.
Soybean Meal Prices & Soybean Meal RatesSoybean meal futures and options are traded at CME Groups Chicago Board of Trade. The contract calls for physical delivery of 100 short tons (about 91 metric tons) of soybean meal. Like most CBOT agricultural contracts requiring physical delivery, the majority of the soybean meal futures positions are offset prior to the delivery period.
Soybean Meal InvestingInvesting in soybean meal makes sense to a broadening range of traders as soybeans are increasingly being seen as a renewable resource not only for animal feed but also with its industrial applications. Diesel fuel with a soybean foundation has gained a wider following as an energy source, capturing the attention of the trucking and construction industry. So the economies of these markets impact
soybean meal trading as well, an example of intermarket influence. See how VantagePoint Software can predict the soybean meal futures market with up to 86% accuracy* - Get Free Soybean Meal Market Predictions now. Soybean Meal Fundamental BackgroundCorn and soybeans are planted in the spring in the United States. Soybean field preparation and planting typically lasts from mid-March through the end of June if soybeans are doublecropped after the winter wheat crop is harvested in southern areas, but the primary planting period in the Midwest where most of the soybeans are grown is during May. Like corn, soybeans are vulnerable to hot, dry weather during the summer growing season. The most critical month for determining soybean yields and the size of the U.S. soybean crop is usually August when blossoming and pod-filling occurs and the quality and amount of soybean meal per bushel of soybeans is determined. Most of the soybean crop is typically harvested in September-October, and soybean meal production usually increases in the winter quarter to its largest level of the year to coincide with the period when animal numbers are usually at their greatest. Soybean Meal Trading TipsSoybean meal and soybean oil production and price prospects are intertwined so a soybean meal trader should not be trading one without being aware of what is happening to the other as well as what is happening in the soybean market in general. At times the demand for soybean meal will dictate the pace of the soybean crush and, therefore, the amount of soy oil available. At other times the demand for soy oil may be the controlling factor in the pace of soybean crush, meaning that either soybean oil or soybean meal could be an excess byproduct as a result of the soybean crushing process. You cant have one without the other. Although soybeans and soybean products are closely related, there are several key differences. First, while there are many competing edible oils on the world market for soybean oil, the competition for soybean meal is less intense in the United States. Fishmeal, cottonseed meal and other sources may provide feed protein but soybean meal is the main source with poultry being a major consumer. Second, while soybeans can be stored for some time while waiting to be crushed, soybean meal cannot be stored for long periods of time, especially in hot weather. So the supply of soybean meal is more of a hand-to-mouth situation, which can lead to surplus or tight situations, depending on the crush rate. If a lot of soybean meal is available, that can pressure prices. Soybean Meal Trading NewsSoybean Meal Trading HistoryBreaking News
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* VantagePoint's accuracy statistics were computed on out-of-sample price data utilizing neural networks trained on both single market and intermarket data and relate to the Neural Index which indicates whether the average of tomorrows typical price and the typical price of the day after tomorrow (both unknowns at this time) are expected to be higher or lower than the average of yesterday's typical price and the typical price of the day before yesterday. The numerical value of the Neural Index, either a one (1) or a zero (0) thereby indicates whether or not the trend direction is expected to be higher or lower for each target market over the next two days. A Neural Network accuracy statistic of 80% does not mean that eight out of ten trades will be winning trades. VantagePoint is not a trading system that gives the same specific buy and sell signals to all users. It is a technical forecasting tool that is comprised of proprietary forecasting indicators that apply neural networks to market data for the purpose of finding patterns and relationships between markets and then using this information to make futuristic forecasts. Using these indicators each trader determines his or her own entries, exits and stop placements which may vary from those of other traders due to differences among traders in trading style, objectives, risk propensity, account size and number of contracts involved, thereby producing different trading results from one trader to another. Futures and options trading involves risk, is not for every trader, and only risk capital should be used. For more detailed information, please read our Important Disclaimer, Privacy Policy, and Software License Agreement. |
