The bean market is now in a ebb and flow market as I would say. What I mean by this. The market has been dominated by the soy oil. The oil share closing at approximately 45%. It is my contention that oil share can make its way to approximately 50%. There are a few reasons for this. The palm market is tight as the production in Malaysia has not ramped up due to labor shortages. This will eventually change. The bio mandates are a big demand every month. There are talks in some country to reduce the blending mandates. These things will happen. We are just not there yet. For the time being, nearby bean oil should remain stronger than nearby meal. This can keep the market ebbing and flowing. I am not sure if there is a high in the soybean market. I don’t think there is a high in the bean oil market. I do think there is a high in the meal market. These remain my personal thoughts at present. As always quantify your risk. A couple things to be mindful of. First the bean oil spreads continue to exhibit overall strength. The meal spreads continue to exhibit overall weakness. My thought at present is these two trends may continue. As always have an exit strategy. I have no conviction in the bean spreads, although I would like to. The bean run could be over in general when the bean oil strength is over.
BE WELL,
John J. Walsh
President, Walsh Trading, Inc.
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