- Corn has started the battle for acres next season.
- The opponents are soybeans and cotton.
- Corn will need increased acres and increased yields to rebuild tight supply.
Soybeans: Bullish news:Soybean prices 3 percent higher in China after palm oil prices climbed 3 percent. South America is too dry to plant soybeans. The freeze in Canada damaged the canola crop limiting vegetable oil supplies. Late planted Chinese soybeans are vulnerable to frost.
Chinese soy oil imports are up 20 percent. Export inspections were only 12 million bushels and below expectations.
Open interest in the soybean market exceeds 141,000 buy contracts. The record open interest for buy contracts in the soybean market is 156,000 buy contracts. Soybeans are not acre competitive with corn and cotton.
Bearish news: The soy-diesel tax credit was rejected by congress; however, demand from other nations is increasing rapidly. If we do not burn our soy-diesel, somebody else will.
Soybeans are overbought and harvest pressure has just begun. Palm oil prices have weakened and soybean crush this week was down to 128 million bushels.
Chinese soybean imports were down 3.5 percent for August but that month remains the fourth largest month of Chinese imports on record. U.S. soybean exports were down to 558,000 tons as anticipated.