The markets are rebounding today led by meal. It is my belief we are potentially on the verge of a large shift in the oilseeds in general. The slow down in Chinese imports is a large story. The ramifications larger. The demand growth for beans and consequentially meal has been unprecedented year after year. This is stalled. Actually predicted to contract. What does this mean? The global carry is moving to the largest number ever, by far. In addition, the global crush capacity is the largest ever. This equates to more protein supplies. This while the share of soymeal globally has declined since 2016 over 3 million tons. The global oilseed growth is expanding. Especially the black sea sunflowerseed. This offers another competition to soymeal. It is my thought that we will continue to see the soymeal sink in use while competition from other protein areas expands. This will ultimately reduce demand for soymeal. The global markets will crush everything it can due to the high margins. It is my thinking that we are close to a high in soymeal. An early rally Monday may offer an opportunity to quantify a long term strategy.
Corn put on a show today after yesterday’s weak session. Was that a blow off low? Remains to be seen. I have favored the corn and believe a window exists for a nice rally. There is talk today that credit concerns could curtail Argentinian plantings. Remains to be seen. I don’t really buy it. All is possible though. It seems that the USDA report in nov offers the best chance to spark some corn bulls. The yields my be overstated. If so, we may have a corn market yet.
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