Soybean futures on the Chicago Board of Trade are called to open Tuesday's day session lower as a stronger dollar, unpredictable crude oil and an overdone rally Monday present a bearish foreshadow.
CBOT soybean futures are called 15 to 20 cents lower.
Friday's selloff and Monday's rally were more than warranted, said Vic Lespinasse, an analyst with Grainanalyst.com.
"If crude keeps rallying and the dollar sells off, that could reduce early losses in grains," Lespinasse said.
But, he added, "the widespread feeling (that) we overdid it yesterday (Monday) sets us up for a turnaround Tuesday."
In overnight electronic trading, September soybeans were 15 1/2 cents lower at US$12.63 1/2, and November soybeans were 18 cents lower at US$12.71. December soyoil was 88 points lower at 52.22 cents per pound and December soymeal was US$4 lower at US$346.70 per short tonne.
After Monday's rally, the bears are "just barely" holding November soybeans prices in a six-week-old downtrend on the daily bar chart, a market technician said.
Sold technical resistance is seen at last week's high of US$13.07 a bushel, with first resistance at US$13, he said, whereas the bears must pierce and close below the US$12.50 per bushel level to penetrate solid technical support, the technician said.
Observations from both the eastern and western legs of the 2008 Pro Farmer Tour indicate that while corn's yield potential looks promising, soybean development is lagging.
Field reports from South Dakota revealed an average pod count in 47 three-foot by three-foot squares of 860.82, down from last year's pod count of 1,068.92, when 48 samples were taken. The three-year tour average is 1,001.58. On the eastern leg, the tour found an average Ohio soybean count of 1,103.61 pods in a three-foot by three-foot square area, down from last year's tour estimate of 1,226.70.
A scout said there was a lot of potential for Ohio's soybean crop, but that many of pods were just a quarter-inch in length and would need rainfall soon in order to thrive.
Tour scouts noted the lowest disease and insect pressure seen in recent years.
On Friday at 10 a.m. EDT, Pro Farmer will release its official crop estimate, based in part on the figures collected by tour participants.
The U.S. Department of Agriculture on Monday reported the good-to-excellent rating of the nation's soybean crop slipped on percentage point to 62%. Blooming was 94% complete, while the 75% average setting rate trailed the five-year average by 12 percentage points.
Lespinasse said he saw no market-moving surprises in the report, but noted the information underscored the delayed development of the crop and its vulnerability to killing frosts.
Warm weather in the Corn Belt is helping advance the soybean crop to maturity, but patches of the region in the north, far east as well as southeast Nebraska have been "too dry recently," said the DTN Meteorlogix forecast.
Recent showers and a break in the heat was improved the crop outlook in the Delta, the private weather forecasting firm said.
In overseas markets, soybean futures traded on the Dalian Commodity Exchange settled mostly lower Tuesday as the market remained cautious amid expectations of a stronger dollar.
The benchmark January 2009 soybean contract settled RMB5 lower at RMB4,175 a metric tonne after trading in a range of RMB4,137-RMB4,213/tonne.
Crude palm oil futures on Malaysia's derivatives exchange ended 1.9% lower Tuesday on selling pressure, but off lows on likely rise in exports, said trade participants.
The benchmark November contract on Bursa Malaysia Derivatives ended MYR49 lower at MYR2,436 a metric tonne, after declining as much as 5.4% to an intraday low of MYR2,351.