Could scant supplies of South American soybeans light the spark for a market rally, as growers there switch some soybean acres to corn?
It’s definitely a possibility, according to DuWayne Bosse of Bolt Marketing, in Britton, S.D.
Even though Brazil, Argentina and the U.S. all had record soybean crops last year, demand from China keeps growing, observes Bosse, and for the first time in years, South America isn’t increasing soybean acreage.
Because of that, any shortage caused by South American weather woes and a decline in acreage could “light that spark that could turn into a really big fire in the soybean market,” Bosse says.
It’s still the dry season in Brazil, so watch more closely starting Oct. 15, according to Bosse. And with the cost of planting soybeans up 8% in Brazil, plus the high price of corn, growers in Brazil and Argentina “are buying corn acres,” he says.
An export tax on Argentina corn was dropped, but it remains in place for soybeans for now.
Watch the full segment of AgDay on the video that accompanies this article.