The bottom feeders continue to support US soybean futures after setting a ten year low early in the week. They call this technical trade. When the market began to rally off the low it managed to trigger a number of stop loss orders, buy orders, thus pushing the market higher and triggering another batch of stop loss orders, thus pushing the market higher. It has nothing to do with soybean production in the US or for that matter anywhere else in the world. It does give the US farmer an opportunity to capture potentially better prices than they may have been looking at though.
The only real fundamental impact, and it wasn’t anything to do with mother nature, was news the Argentine government was considering lifting the export tax on soybeans from 28.5% to 33%. It’s a bit of a lucky dip on who will end up paying this though, the grower with lower prices or the exporter with higher FOB values, I think we all know the answer to that one.
US wheat futures found support from the weaker US dollar and the action in the soybean pit. Crop losses in Australia is still getting a mention but that news is day’s old now and the market will be looking for more bullish news in the new week to make any attempt to move higher.
Increased feed demand from the EU may come as a blessing for those in Russia and Ukraine that produced feed wheat this year. The hot dry summer cut yields but what wheat did grow was generally of a good milling grade in western European countries.