Jerry Gulke sees relative tightness in soybean stocks when compared to global demand
Despite record crops in the bins here in the U.S. and South America on track for outstanding yields, why are the prices holding? That’s what Pam Fretwell asked Jerry Gulke, president of the Gulke Group in this week’s Weekend Market Report.
While the USDA has already penciled in a large demand for soybeans out of the US, the market is action as it is either underestimated again and more is needed, as prices are resilient and are holding in near $10 not only for old crop but for new crop 2017 giving many producers a shot at $10 out of the field for next fall. Supply is keeping up with perceived demand, thanks to a monster crop out of the U.S. this year.
Had we produced trend-line yields, prices would be much higher. With global demand increasing 5% to 7% year over year recently, perhaps the market is telling us we need more acres next year just to ensure adequate supplies under an average yield.
Bottom line: we might not be as flush with beans as we think
Listen to Jerry Gulke’s full commentary to find out what producers should be thinking about right now.