2/1/2022

Soybeans continue their impressive run to trade easily through and above the 1500'0 level. Another round of steep cuts to Brazilian soybean production estimates spurred more buying today, with several now below last year's totals. The USDA made more sale announcements at 8am this morning that included 132,000 tonnes of soybeans to China for 2022/23 and 110,000 tonnes of corn to Mexico for 2021/22. Fresh contract highs again as we continue higher into uncharted territory on the daily charts. Feels like someone, or something, wants to see how far we can go and with money readily available and fund position limits double what they were a year ago, I guess it’s time to just go along for the ride. Soybeans have rallied approximately $3.50 from the harvest lows, half of that just in the past 2 weeks, almost entirely fueled by the Brazilian weather story. It feels like we are at the hot air, too-far-gone, point of this price move. Brazil is a big country and their state of Parana produces an estimated 16% of their soybeans. Parana alone has 10 soybean producing regions, 5 unique soil classifications, and 2 different major climate groups that include their own subgroups. Summary: Brazil is going to have soybeans to export, it’s just a matter of if they have enough to satisfy usage. There are always other forces at play when it comes to market volatility and money, as well. We are still waiting for a story to develop on corn as it continues to be a reluctant follower to whatever works to its benefit on a given day. Over the past week we have observed the ethanol sector backing off on their corn bids by a considerable amount.


Not much for long-term major resistance above our current levels in corn and soybeans.