The old crop soybean supply and demand situation is getting interesting! Traders are listening to below expected yield reports out of Argentina and farmers in those drought regions holding on tightly to what stocks they have. The USDA April carryout of 165 mbu may get cut again in the May 12th report as China demand has spurred exports at a time when they usually buy from South America.
Brazil harvest seen over 70% complete and farmer selling is at least 10% behind that of a year ago. A tighter old crop soybean supply will also be noted with new crop S&D projections which have the soybean : corn ratio ratcheting back up to 2.21:1 (Dec 09 @ $4.25 and Nov 09 @ $9.39). Only a month ago that ration was below 2:1 when old crop soybean supplies were thought to be abundant.
Corn strength lies in the weather with little planting and below normal temps persisting. It will be nice to get a little warm weather heading into the weekend and hope to miss the showers Sat, Sun, and Monday.
Scott Meyer
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