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Soybeans, a hot commodity

It's the hot commodity these days in the grain pits, with new recent
highs this week putting the spotlight on the soybeans. Corn and wheat are
struggling a little more as their export market is not very alive at all. But
soybeans, ah soybeans, they have an export market that is red hot right now.
Export sales and shipments of 50 mb/week continue to rack up strong export
demand for this commodity, with China leading the way buying 50-65% of these
exports every week. The soybean export market is hot all right! Its not often
that soybean exports exceed corn and wheat combined, but some weeks we are
actually doing that so it is indeed a strong export market. West coast
terminals are loading/unloading soybean trains instead of corn trains recently,
an unusual event for sure in the West Coast market.

But the soybeans are selling like hotcakes, and it doesn't take much to see
where this export train is heading. USDA projections continue to rise for
soybean exports, and the US is likely the only game in town until the South
Americans start exporting their new crop market again in March/April. For now,
the US dominates the soybean export activity, and it is indeed very good for the
US soybean market.

Not only is the export market strong for soybeans, but also the dollar is weak
(new lows again this week) along with a strong gold market (new highs again this
week) that are continuing to add to the strong fundamentals of the soybean
market.

On the negative side for soybeans, harvest has accelerated to the point where
94% of the crop is now (finally!) harvested, almost equal to the pace of the
normal harvest (97%). The threat to the US soybean crop might finally be over,
with the soybean crop mostly harvested in the corn belt and only a few areas
still struggling (like the Red River Valley of ND/MN, where soils are still too
wet in many locations to support combines). What damage has been done is now
history, and the soybean crop has finally been harvested in most corn belt
locations.

Corn harvest is still slugging along, with 68% now harvested Nov. 22 vs. the 94%
that is usually done at this time. The slow pace is mostly due to the still
very wet corn crop, with growers still struggling to get it harvested, and
struggling even more to get it dried after harvesting it. This is indeed a
problem, as the lateness of the crop development and the awful October have left
us with less drying days to get the crop dried down. We just don't dry as well
in November as we do in October, when temps are warmer and the days are longer.

The struggle continues with corn harvest, but the market seems more comfortable
with corn's situation as exports are poor thus far for corn. There seems to be
plenty of feed grains available to the world for now, so the market is content
to let the corn production flow into ethanol and feed chains for now. The
export market right now must improve immensely in future weeks to meet the
current USDA export projection. We just aren't selling or shipping much corn
for now. Will it increase after the South American harvest, which includes less
corn in their rotations? Perhaps the US will get a larger corn export market
share? Or is there enough feed wheat, barley, and oats in the world where
importers will not want to pay to ship US corn to them? This is still a
question mark when it comes to the corn market.

Wheat really should be supported strongly by the weak US dollar, as wheat is
more export dependent than corn or soybeans as a higher percentage of wheat goes
for export than corn/beans. But US exports have been pathetic for the most
part, not very strong - especially when compared to the red hot soybean market.

Yes, for now, soybeans are the darling child of the grain market. And
rightfully so, considering the red hot pace of exports to date.

The information contained, while not guaranteed as to accuracy or
completeness, has been obtained from sources we believe to be
reliable. The opinions and recommendations contained are based on
our judgment and do not guarantee that profits will be achieved
or that losses will not be incurred. Recommendations should not
be construed as an offer to buy or sell commodities. There is
substantial risk of loss in trading futures and options on
futures.

If you have questions about this column, call Progressive Ag at 1-800-450-1404,
or email Ray at rlgAATTprogressiveag.com.

It's the hot commodity these days in the grain pits, with new recent highs this week putting the spotlight on the soybeans. Corn and wheat are struggling a little more as their export market is not very alive at all. But soybeans, ah soybeans, they have an export market that is red hot right now. Export sales and shipments of 50 mb/week continue to rack up strong export demand for this commodity, with China leading the way buying 50-65% of these exports every week. The soybean export market is hot all right! Its not often that soybean exports exceed corn and wheat combined, but some weeks we are actually doing that so it is indeed a strong export market. West coast terminals are loading/unloading soybean trains instead of corn trains recently, an unusual event for sure in the West Coast market.

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