Soybean prices began moving higher in July 2010, starting
from about $9.50. July 2012 soybean futures reached a high of about $14.70 in
late August 2011, declined to a low near $11.25 in mid-December 2011, and
reached a high of $15.12 in early May 2012. Prices have been very choppy the
past two months, but the July futures contract is now trading within about $.30
of the early May high. November 2012 futures prices have been lower than July
futures, but have followed a similar pattern and are now trading at a contract
high near $14.30.
U.S. soybean market fundamentals have been strong for an
extended period of time. The strong fundamental factors have included record
large exports in 2009-10 and 2010-11 as Chinese demand expanded, a reduction in
U.S. soybean acreage in 2011, a relatively low U.S. average yield in 2011,
intentions to reduce U.S. acreage again in 2012, and a very small soybean
harvest in South America this year. These strong market fundamentals continue in
the form of a rapid pace of consumption and concerns about the size of the 2012
U.S. crop. <Read More>
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