Chicago Board of Trade soybean futures are seen beginning Tuesday's day session with a defensive undertone, as traders eye weather uncertainties in Argentina.
CBOT soybean futures are called 2 cents to 3 cents lower.
In overnight electronic trading, March soybeans finished 1 1/4 cents lower at US$10.07 3/4. March soymeal was US$0.20 lower at US$316.10 per short tonne, while March soyoil ended 1 point higher at 33.59 cents per pound.
The market is in the midst of a volatile period tied to weather conditions in Argentina, with traders struggling to get a strong conviction on price direction as forecast models have shown a tendency change over the course of the day, said Vic Lespinasse, analyst with Grainsanalyst.com.
"The market's price theme is only as good as the last weather forecast," he said.
However, news that Argentine President Cristina Fernandez declared Monday that the country was suffering from an "agricultural emergency" brought on by a devastating drought affecting farms and ranches around the nation was seen as supportive, analysts said.
Another problem for market bulls is that there is likely to be a record large cushion of beginning stocks helping to moderate crop losses in Argentina, an analyst reports. This is letting traders believe that South America does not need to have a large crop, especially if there will be a significant increase in U.S. soybean plantings, the analyst added.
Meanwhile, the potential for a seasonal February price break occurring soon is keeping buyers cautious.
A market technician said the next upside price objective for March soybeans is to push and close prices back above solid technical resistance at the January high of US$10.60 1/4 a bushel. The next downside price objective is pushing and closing prices below solid technical support at the January low of US$9.57 3/4 a bushel.
First resistance for March soybeans is seen at US$10.25 and then at Monday's high of US$10.41 1/2. First support is seen at US$10.00 and then at Monday's low of US$9.91 1/2.
The DTN Meteorlogix weather outlook said drought conditions continue in several areas despite the weekend shower activity. Any chance for improvement during the 6 day period is mostly for Cordoba but this area has not been as bad anyway during the recent weather scare. Today's long range charts hold out some promise for significant improvement, however this is a long range outlook and subject to significant day to day concerns.
In other news, India's state-run company PEC Ltd. has issued a tender to sell 2,238 metric tonnes of crude soybean oil at the eastern port of Kakinada, a company official said Tuesday.
In overseas markets, China's soybean futures traded on the Dalian Commodity Exchange will be closed until Feb. 1. The exchange is closed for the Chinese New Year holiday.
Asian crude palm oil on Malaysia's derivatives exchange was closed Tuesday for public holidays.
