Sep 17, 2014
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Current Marketing Thoughts

RSS By: Kevin Van Trump,

Kevin Van Trump has over 20 years of experience in the grain and livestock industry.

How Much Higher We Go To Ration Beans?

Apr 16, 2014

Soybean volatility remains extreme! Just tell me the last time you remember ever seeing the market pop $0.30 cents on better than expected NOPA crush data?  That's exactly what happened yesterday when the crush was reported at 153.84 million bushels vs. trade expectations of around 146 million bushels.  This was up just over 8.5% from the previous month, and basically means we used 8-9 million more bushels of soy for crushing than what the trade was anticipating.  The problem is, when you have an ending stock number that is more than likely sub-100 million and needs "rationing" this is NOT the solution.  Let's not forget the USDA, in their latest report, lowered their US crush estimate to 1.685 billion. In return, the job of the market is to immediately raise prices higher in an attempt to better slow down demand.  Eventually prices will move high enough that buyers will no longer be interested or US importers will become even more incentivized to import larger amounts from South America.  At this point, it simply becomes a guessing game as to how high is high enough??? As I mentioned several weeks back, the $16.00 old-crop price tag is not out of the question.  CLICK HERE for my daily report....

Making New-Crop Soy Sales: The NOV14 contract has once again traded back above our latest cash-sale trigger of $12.34, producers who have been waiting or missed the past few opportunities are being given another opportunity. With prices well above insurance guarantees and at profitable levels, reducing risk to some degree seems to be "best-of-practice." For those who already have closer to 60-70% priced/hedged (like I do), I would simply remain patient, as there may still be some additional upside, just depending on US weather headlines. CLICK HERE for my daily report....

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