By Jon Scheve, Superior Feed Ingredients
There are many factors that affect the futures market. It’s easy to rationalize why the market could be headed for a rally or a decline at any given time. Last week I discussed the reasons to be bearish or bullish corn. This week I discuss beans.
Reasons To Be Bearish:
- The most massive carryout in bean history – currently at 950 million bushels
- Good weather throughout much of Brazil for most of the growing season
- The Brazil harvest is beginning this week and will be in full swing before the end of January
- Lack of adequate storage requires South America to move their beans shortly after harvest
- China has not bought many US beans this year
- The Asian Swine Flu in China could be much worse than stated and demand for soybeans could be greatly reduced
- China claims to have found substitutes for soy in their pork diets
- China has adequate stocks of soybeans and could wait a year to replenish their supply without buying US production
- Last year Argentina had one of the worst droughts in 40 years.