September soybeans closed up 29 1/4-cents at 13.24 3/4.

September soybeans closed higher on Thursday following today's bullish supply-demand report and production estimate by the USDA. September soybean soared on the opening after the USDA cut its yield estimate from 43.4 to 41.4 bushels per acre. This was also below the average trade guess of 42.8 bushels and caught the market off guard. The USDA also lowered old-crop demand and increased the carryout by 30 million bushels. However, they had to lower new-crop demand by 118 million bushels in order to keep the supply pipeline functioning. That means that the market must slow crush by 20
million bushels from USDA's July estimates. Exports will also need to be cut by 95 million bushels. A cut of this magnitude in exports might be hard to due especially since China accounts for 62% of our exports. With high food inflation in China, they will find it hard to cut their demand for soybeans. The mid-range close sets the stage for a steady opening when Friday's night session begins trading. Closes above the 20-day moving average crossing at 13.54 are needed to confirm that a short-term low has been posted. If September extends the decline off July's high, March's low crossing at 12.56 is the next downside target. First resistance is the 20-day moving average crossing at 13.54. Second resistance is the reaction high crossing at 13.74 3/4. First support is Tuesday's low crossing at 12.76 1/2. Second support is March's low crossing at 12.56.