Soybean Futures Drop on Supply Concerns

With the outlook of increasing soybean supplies in North & South America, soybean futures fell to prices not seen since early summer.  All US grain markets have fallen for that matter.

Last week, the USDA reported world soybean inventories to be 60M metric tons at the beginning of October – just over 4% more than forecasted for October.  The US soybean harvest will be almost 3B bushels – up almost 4% than the prior harvest.

Soybeans remain under pressure from long liquidation by funds. Technically the market looks weak, however, despite recent reports from the USDA the supply picture remains quite tight,” said Kevin Craney, a senior commodities broker for RJO Futures in Chicago, regarding the current soybean futures situation.  Craney adds, “In the end the fundamental supply and demand picture will support the soybean (futures) market.”

The trend for soybean futures is now clearly down.  It had appeared to be turning the corner “UP” as soymeal futures, but after last weeks USDA Crop Production report it is now decisively down.  I can only get short soybean futures after a pull-back higher.

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