January soybeans were 18 1/2 cents lower overnight. Palm oil in Malaysia finished 0.8% lower. Crude oil made yet another new low overnight, and the dollar index was higher.

The soybean market rallied yesterday, but gave back most of its gains by the close. Dryness concerns in Argentina and concerns that the planted area may need to be adjusted lower helped provide support for the early rally. Soybeans, meal and oil all participated in the overnight break. Traders indicate that concern over a lack of direction in terms of the government response to the economic crisis is adding to negative price action in financial markets and this is causing traders and analysts to take a closer look at domestic demand prospects for meal and soybeans. Continued oversupply of palm oil also weighs on the soybean complex with governments in Malaysia and Indonesia responding to complaints by small farmers that crushers will not buy their fruit. Analysts say that attempts by the government to force the crushers to accept more unprocessed fruit from small farmers will only serve to increase unwanted stocks of crude palm oil. The weekly export sales will be released ahead of the opening and traders are looking for soybean sales to remain above the weekly rate of about 284,000 tonnes needed to reach the USDA's export projection for the current marketing year. Talk of improved demand from China this week will not be reflected on today's report. China government officials indicate that they plan to buy as much as 3 million tonnes more soybeans on the domestic market to boost up state reserves in an effort to support local prices.

The beneficial reversal of weather patterns in Brazil that started about two weeks ago continues this week. Rain is expected in northern areas of Mato Grosso that are still a bit on the dry side, and welcome drier conditions continue to prevail in previously wet areas of the south and south central soybean and corn belts. In the US, cold air is expected to push down to the Ohio River Valley today with snow in Michigan and NE Ohio. Very cold air should remain through early Saturday along with dry conditions in most of the Plains and Midwest. Rain may push into the central Midwest to start next week. Iran is in the market for up to 25,000 tonnes of soy oil and up to 20,000 tonnes of sun oil. India is in the market to buy 26,500 tonnes of edible oils by mid-November.