There's a 60% chance of a seasonal price rally for soybeans between March 1 and July 6 based on the past 10 years, says Moe Agostino, commodity strategist for Farms.com Risk Management.
"Looking at the seasonal chart,” he says, "historically, soybeans are relatively flat until mid-February into March, when they rally until late June before falling off through July. Only one year in the past 10 has provided a harvest rally for both corn and soybeans.”
This year, it could be tough for soybeans to make much of a rally, given ample stocks and the huge South American crop that is beginning to move. Predictions of another cool, wet spring might catch traders' attention, but as 2009 results show, today's crops post excellent yields under those conditions.
Given USDA's supply estimate, China's switch to buying from South America and expectations for more acres in 2010, marketing advisers believe soybeans will be under pressure barring a U.S. crop problem. "It is time to sell aggressively anytime beans are above about $9.50,” says Justin Kelly, president of EHedger.
You can e-mail Linda H. Smith at email@example.com.
- Mid-February 2010