The following commentary does not necessarily reflect the views of AgWeb or Farm Journal Media. The opinions expressed below are the author's own.
Kevin Van Trump has over 20 years of experience in the grain and livestock industry.
Soybean bears have watched the market trade lower for eight consecutive session. Most "technicians" believe the market has one major (nearby) objective in mind, and that's to take out the January NOV14 contract lows at $10.88 as quickly as possible. Perhaps once we close below that level the market might start to find more equilibrium and balance...the key word there is "might." I'm afraid with 85 million soybean acres planted, it's going to take a very big weather hiccup (which doesn't look to be in the cards) to drop yields to levels that need major bullish consideration. There is some talk that soybean acres in India are going to see a -5% reduction. There's also some talk if prices continue to break planted soybean acreage in South America may also tapper back a bit. These are real long-shot headlines though and certainly NOT nearby game changers. Many source now predicting, if weather stays in a similar pattern, soybeans will eventually trade in the single digits (in other words sub-$10.00). Tough for me to argue, especially when you consider we have such massive planted acreage and one of the best condition ratings in US history. Nearby the basis seems to be firming a bit both here in the US and Brazil, while there is still no real noted farmer selling in Argentina. The outside markets a re bit more nervous than we've seen and commodities are getting a bit of a bounce this morning. Some bulls may stick around clinging to one last glimmer of hope in old-crop...but I have to believe the long side of this market still looks like the wrong side of this market over the next few weeks. CLICK HERE for my daily report...
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