With trade talks continuing to drag out between the US and China (and not without any new hope), the market has likely shrugged off any hopes for a massive (near term) purchase of any US products and is likely turning its attentions to weather events for 2019. Spread markets reflect this idea and continue to show a bearish hand for outright soybean prices, with much of the cost of carry matrix trading at or near 80-90% full carry levels (in front month spread). When calendar spreads are trading at or near full carry levels (like front month beans spreads are now), they offer a rare opportunity to bull spread against the arbitraged fully carry level; however, they also represent well supplied and generally bearish price scenario for outright commodity prices.
This weeks Commitments of Traders report is showing non-commercial participants also net short soybeans by -46k (down from -51k last week). This is still a way off from the all-time largest non-commercial short position of -113k (6/27/2017) for soybean futures the US futures market has plenty of room to add to that short sentiment. It is impressive that even in the face of the May 19 contract rollover, neither front month calendar spread prices nor outright price seems to be...
Dan's full "Spread Outlook" is available for download, including an indepth look into the most liquid spreads and market conditions that might present opportunities for spreading! Complete with charts and cost of carry calculations!