Kory admits to mass confusion. Record crops and short crops everywhere down there. Flooding and drought areas nearby. 1305 1324 1336 areas to check out. Depends on what level you started subtracting from last couple months, he now says 144 was probably too low back then. Says he just plain needs more data and he could be a giant bull in a couple weeks because conab will not get real aggressive yet to cut bean crop.
https://www.youtube.com/watch?v=Img0h1vslzY Snodgrass latest
Eric and I agree 100% on the SA weather!
Very hot with no rain thru 10 days with ultra high confidence for the drought areas of Argentina and S. Brazil.......then moderate confidence of a pattern change that will increase rains.
I don't see a bear trend happening in beans anytime soon.
Mostly, it will depend on the weather in SA next week. The pattern change to increasing rains starts on day 9 right now.......moderate confidence and growing because its been there for many days straight and gets closer by one each day and its a PATTERN CHANGE, not just 1 system that zips thru, one and done then back to hot/dry.
Extremely high confidence of hot/dry until then....but the market knew that today and dialed in most of the additional damage to the crop, I assume from the spike higher and the uncertainty of a week 2 forecast.........I assume.
We have a pretty big crop report on the 12th, next Wednesday which will surely take center stage just before and after, regardless of the weather.
So let's say the rains and pattern change just keep getting closer by 1 day, every day next week.
That will mean that next Friday, they will be 2 days away(on Sunday, before the market opens on Sunday Night, with more rains the week after that).
There is absolutely no way that the market will keep going higher facing that weather picture.
The question is how early next week will it start reacting strongly to the upcoming rains?
If they keep getting closer, and the end of the forecast keeps adding rains like it has been because of the new pattern........and we have 2"+ to almost the entire dry area and some areas getting 3"+ in the 2 week forecast early next week, we should crash below $14 pretty quickly.
Those rains can't revive tons of lost potential and permanent damage ......and beans won't go back to the price they were over a month ago BEFORE the market lost so much production/supply permanently on the world market(that won't be made up until the US growing season) but they would STOP the damage and STOP the downside for crop estimates to be dropping to and put in the top for beans because no speculators will be buying on OLD news of damage that we traded the last 2 months or buying on increasing rains in a drought.
That's the ideal recipe for a market to crash lower and ideal weather shorting opportunity.
If we take out rains next week..........we can still go higher. 9 days is still pretty far out.
Yes, I agree with you Mike, but I still think overall the market is bullish. Dropping 15mmt of production is not a small thing.....as you noted. This crop isn't going to get any bigger.
I'll remind you of my "theory" that we have reached peak production. Or I think "peak storage" would be more accurate of what I am trying to convey. We might improve production, but demand is outpacing it. I still see nothing happening that is going to change that anytime soon.
But anyway. We could see a short term peak this week, but I don't see us breaking down into the $12 range anytime soon. Maybe not this year. Maybe we will see more rain across the US this year with the change of La Nina. Maybe we will have a bumper crop this year in the US. It's the maybe's that bring us here. :)
Jim peak production? Not yet. did you know the unheard number of 100 bu/a has been reached many times recently. And if you have not read much about Kip Cullers find him on the net. Has reached 172b/a in Missouri. Now of course these numbers are not in large scale production yet but yields are up, not quite like corn but up they go.
Yes, I agree. We may be able to produce more in a square acre measure. My real point is that production isn’t keeping up with demand. It “seems” like it is topping out. Nothing measured. Just a casual observation.