The week ending on a quiet note. The overnight showed a reasonable jump in prices. The day session settles back. The beans were essentially the leader. The vegoils, due a set back. eased a bit. The long term for vegoils remains friendly in my opinion. The weather over the weekend will be important. The market, in my opinion, has dialed in risk premium relative to SA production. It is true that the SA production is critical for the 2021 year. There does however remain a bit of time and the yields can still turn out on the high end of the range. The US domestic carry is tight. The global is ample, even with the draw down in stocks. This is my theory and should be viewed as such. The markets belong where they are. The question now is will they go higher. Food for thought. The bean oil will, in my opinion, become the strongest leg of the complex. It is harder for vegoils to push a big bean rally. The current stocks to usage may suggest we are at a fairly proper price. It is true of course that any changes, be it weather, or political will have an effect on the market. Lets see what happens over the weekend.
John J. Walsh
President, Walsh Trading, Inc.
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