SA Crop
8 responses | 0 likes
Started by Jim_M - Sept. 11, 2018, 11:47 a.m.

I read this morning that Conab has increased the size of the SA bean crop to 119.3 mmt from 118.9 mmt

Re: SA Crop
By wglassfo - Sept. 11, 2018, 1:09 p.m.
Like Reply

Unless some kind of weather event happens, I find Conab reasonably accurate. As good or better than any other. So a good crop of SA beans is on the way.

I have been worried about our NA corn and bean price for 2019/2020 and maybe beyond..

I understand that china has said they will have to import 13-14 million bu of American soybeans starting in January 2019, if my memory is correct from a mcfarm post. However this does not seem to be enough compared to what needs to be exported.

So next yr. my logic says the price of beans is likely to be at fire sale prices and farmers plant more corn, due to low soybean prices.. If price of beans is bad enough a lot more corn gets planted.

Does anybody think we have lost the china soybean market??  china seems to be making every effort to find new land to grow beans. I don't think they would make this investment for a yr or two. Looks to me as if this is a long term source of beans.

To my way of thinking, I can see a wall of surplus corn and beans with not enough market for the expected production and no indication of anything but down..

I don't think the 12 billion bail out will influence Chicago price, but just MHO

Does anybody think a short position in 2019/2020 corn and beans is a good idea??


Re: Re: SA Crop
By silverspiker - Sept. 11, 2018, 1:25 p.m.
Like Reply

Yes...can always buy hedges back at unch.

By Jim_M - Sept. 11, 2018, 2:01 p.m.
Like Reply

I only know from what I read, but my understanding is good farming land in China is hard to come by.  

Re: SA Crop
By wglassfo - Sept. 11, 2018, 3:14 p.m.
Like Reply

Yes farm land in china is all being planted and no more is available, at least what would support row crops or food production.

 [I have no idea how china runs it's Ag business or what to call it, in proper terminology]

However, Russia has vast crop land in the far east [close to the Chinese border] [how close I do not know] that used to be farmed during the days of collective farming and is now idle, with rusted machinery, old bldgs. etc. all abandoned, due {I think] to nobody having the ability for a clear title or permission to enter and farm the lands. I did some research on Russian abandoned land and found numerous pictures of old abandoned collective farms.

Russia offered free land to anybody who wanted to settle and farm, but the plots were so small [1.5 hectares on average] that family farming was not feasible on such a small plot of land

Then enter china and an agreement for china to farm 1000's of hectares of land with more available.

China plans to grow row crops and move this grain to Chinese processors. This has all been announced in the past couple of months but you can be sure plans were in the works for much longer

It doesn't take a genius to see the win-win for Russia and china

As we have read china and Russia just did or plans to do [IDK] military drills together, so the alliance between china and Russia is slowly getting stronger.

We have heard about Chinese farmers working the soil in Africa on small scale family size acreage, for some yrs.

China is actively growing soybeans and other food products in at least Russia and Africa. The Russian lands may be more suitable for canola, but canaola is still a feed ingredient for the Chinese, largest hog numbers in the world.

I may be wrong, but Russia and Africa offer the largest land mass, of soils and climate to exploit for food production, that I know about.

So far, we haven't seen any large scale exports of pork to china from Smithfields, located in the USA, that I know about.  Just one more example of china preparing to feed their people, however Smifields has not made any moves to expand, so that avenue is not open to increase USA consumption of animal feed.. If china can't rely on foreign supplies, it seems obvious that china is taking some serious concrete steps to assure themselves of land and food for china

Re: Re: SA Crop
By metmike - Sept. 11, 2018, 4:39 p.m.
Like Reply

China has devoted much of its productive land to growing rice and wheat at the expense of soybeans. The maps below, show the areas where some of the key edible crops are grown. 

I don't have enough information to  comment on the land that Russia might be selling to China. It would be just west of the area where China currently grows beans, apparently.

By metmike - Sept. 11, 2018, 4:40 p.m.
Like Reply

The information below was from several years ago. In the last few years, record smashing soybean production has overwhelmed the increase in demand. 

Not to be overlooked, the improving climate and increase in CO2 have made  positive contributions to the increase in supply that are usually overlooked.

Since 1988, there has been only 2 major, widespread drought(2012) in the US.

Of course South American keeps increasing planted acres too.

Full Planet, Empty Plates: The New Geopolitics of Food Scarcity


Chapter 9. China and the Soybean Challenge

The above information and charts had been pretty bullish but production was just too massive the last few years............especially this year:

Soybean Supply & Demand Charts:

By Jim_M - Sept. 11, 2018, 5:10 p.m.
Like Reply

Great charts Mike!

By metmike - Sept. 11, 2018, 5:19 p.m.
Like Reply

Thanks Jim!