Beans Overcome Bearish Headlines...

Published on: 15:47PM Jan 22, 2014

Soybeans have fallen under a wave of bearish headlines as the front month gives back over $0.35 cents to start the week. Technical traders will be keeping their eye on the 200-Day Moving Average which is now close to $12.76. If we see the front end of the trade close below this level, the $12.50 area will start to come into focus and if that level is breached the lights at the party might be off for some time... or at least until negative headlines start being released regarding Brazilian logistical problems or another round of South American weather hiccups.  Below are a few of the more talked about bearish headlines that have hit the soybean market...Click here for my daily report


  • Argentine Weather: Argentine rains could be a "yield saver" as 3-4 weeks of extremely dry and hot weather have had some analyst starting to backpedal on their production estimates. Thoughts are this could be extremely timely rainfall.
  • Bird Flu: The World health Organization is announcing another 23 people in China have been infected with the H7N9 strain of bird flu in recent days, adding to at least 24 new cases last week and confirming a fresh surge in the virus. With many people in China traveling the next few weeks for the upcoming Chinese New Year celebration there is fear that the bird flu viruses might spread more rapidly.  Certainly worth monitoring.
  • Chinese Policy Change: Chinese leaders made it official over the weekend that they will no longer be supporting their current soybean stockpiling program. In turn they will shift towards a more direct payment type program for the farmers. The shift had been widely anticipated after several years of stockpiling failed to encourage an increase in cotton and soybean planting by farmers while also pushing domestic prices well above international markets, prompting more imports. The fear is this move will now allow Chinese domestic soybean prices to actually push low enough to compete with international prices, thus giving crushers less of a reason to import soybeans from the US. However, I am also hearing.....Click here for my daily report....
  • Chines Crush Margins Narrowing: Talks inside China are that crush margins are backpedaling as the country approaches their Lunar New Year holiday.  We have seen demand taper back in the past few years heading into this event and it could obviously play out again this time around. 
  • Possible Cancelations??? There are rumors circulating that 2-4 cargoes of US beans have been switched to Brazilian origin for Feb shipment. Is this the first domino to tumble???Click here for my daily report...Thank You