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Last year's soybean crop was 400 mb bushel larger....on June 1, the USA soybean stocks were less than one year ago.
SA cash premiums remain strong. Our potential ending stocks could be pretty slim.
In terms of acreage, group 1 states gained 750m, group 2 gained 700, group 3 gained 200 & other states gained 800 ma.
On balance business has been pretty good considering we have fought a stronger dollar for awhile & considering we hang off the cliff of economic depression. I am reminded of the painting of the cowboy hanging from the bridle of his horse & the horse hanging over the cliff.
I have held for quite some time there is more to this soybean market than all the bearish concern....Cash markets within the export trade have remained firmer than most expected since the first of the year. However, trying to remain solvent while trading beans these past few months has been a sweaty challenge.
Now, before everyone gets all bulled up....it is likely we will endure a large supply of lower protein wheat....therefore some substitution for corn. And the next trick, will the USA print more money? More money is needed. We are entering an environment of negative real interest rates while the economy remains slow.
If the democrats suffer election losses, I suspect the republican congressional string pullers will want to insure Obama is a one-term President. Therefore, behind the scenes, an economic shambles may not be contrary to their plan. If so, then between election day & January, a lame duck congress may take dramatic action towards their agenda. Translation, in economic terms "the fat lady is still off stage."
I find that spending a bit of time in California is good for the perspective. Most folks out here are not minute by minute market watchers as it requires you arise about 4 am to be informed. I note, particularly in the Brentwood, Santa Monica & Beverly Hills areas there is some pretty fancy commercial property which sits empty. Potential city, state and county lay-offs are about to begin. We walked to dinner the other evening (our daughter advised against it as she said "dad, Santa Monica is not the same as a few years ago..it can be a bit dicey)..regardless we walked a few blocks & as we approached the restaurant I noticed a clot of homeless with their belongings in plastic bags huddled next to the building amidst all of the pricey parked $100,000+ automobiles. A strange sight. I suspect the demand for private security will increase as folks can climb over these gated community fences fairly easy. I also noted, a first, a panhandler made it into the restaurant stopping at quite a few tables before he was rushed out the door.
Conditions in the underbelly are not good out here.
More later, I am accustomed to access to several computers for preparing research and suffer a lot of brain lock operating from a lap top.
Edited by SeniorCitizen 7/1/2010 08:39
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