The verdict is still out on soybeans!
Sep 03, 2013
Soybeans remain the hot market, with everyone in the trade waiting to see if we can take out the $14.09^6 high. Bulls continue to fear poor soil moisture levels and lack of rainfall in August and into September could ultimately devastate production in parts of IA, IL, MN, ND, WI, and MO. Their belief is the cooler than normal temps early on helped mask the dry conditions that were taking hold. Now all of a sudden we have the driest July and August on record for some areas and the trade somewhat surprised by the reports of short plants, limited pods, plants already turning yellow, and major dead spots out in the fields. While there is starting to be talk of the US corn yield falling to sub-150 levels, there is more talk that the soybean yield could ultimately be sub-40 bushels per acre, a number that simply will NOT pencil! This is obviously giving the soybean market stronger rally legs than corn which will enjoy substantial gains in yield when compared to last year. For those producers who are waiting on prices like last year, just remember, the trade was talking about a 32 to 33 bushel yield for the US crop during the height of the run up to $17.94^6...that's not anywhere near the case this year. Moral of the story, don't be afraid to book profits and reduce risk with prices above $14.00 a bushel. Also keep your eye on the 2014 prices, a move back above $12.50 will once again insure profitable farming.
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