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| I posed your question on Market Forum to Dave Brew who lives in Brazil. Here was his reply (he has always been straight forward).
* Welll it's rainy right now but should clear for ..
Dave Brew - Thursday at 2:12 PM
.... the long weekend (US holiday monday, Brazilian holiday tuesday - Yeah!!).
Weather risk for southern Brazil and Argentina is greater than normal as we're looking at La Nina which tends to cut precip down here. In the past this was far more important as the vast majority of SA's beans were grown in this area.... however nowadays our growing area has expanded north and north west meaning that even when we have problems down here it doesn't automatically decimate the whole crop: the geographic hedge!
Last few years ahve given us good crops allied to high prices or smaller crops but with high enough prices to keep the farmers in gravy. This year as world stocks are still large, interest in our weather has been small but we've been watching it closely and SHOULD the US crop end up smaller than currently expected and SHOULD China continue to up their import requirements then, in theory at least, our weather situation will become progressively more "interesting" market-wise.
I mentioned here a day or so ago that I've been bearish soybeans for a while now but for a market which seemingly ignored generally OK growing weather in the US and generally large world stocks, I've been accepting that the price drop that I was expecting might not arrive. All I'm hearing here is how the Chinese are going to import considerably more beans than has been envisioned. If that happens and if we DO have weather problems down here in the south..... perhaps it might be interesting to place more comfortable coffins on order.... !!!! [g!]
Best of luck, however it pans out.
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Brazilian drought
