COMMENTARY:
The beans have broken approx one dollar per bushel over the last week. This is fueled by the retreat in the energy prices. Also, the talks in Ukraine regarding a settlement with Russia. There may be larger thoughts at play here as well. First, the Chinese demand is declining. This is supported by recent sales numbers. Second, the global economy, with higher inflation and costs could witness a decline in demand as well. We spend a lot of time talking about supply. It is important to remember there are two sides to the coin. Third, the global oils are starting to show signs of supply increasing. This is important as tight veg oil supplies have been a major driving force to oil seed price appreciation. There are many governments thinking of reducing mandatory blending rates. If adopted this would prove significant. The USDA will release acreage estimates this week. Look for 1.5-2.0 million more bean acres. This without the proposed release of more CRP acres. The bean acres could grow substantially, especially given the input costs at present.
Lets see what happens the rest of the week.
BE WELL,
John J. Walsh
President, Walsh Trading, Inc.
800-993-5449
312-208-8836
[email protected]
www.walshtrading.com
Walsh Trading, Inc. is registered as a Guaranteed Introducing Broker with the Commodity Futures Trading Commission and an NFA Member.
Futures and options trading involves substantial risk and is not suitable for all investors. Therefore, individuals should carefully consider their financial condition in deciding whether to trade. Option traders should be aware that the exercise of a long option will result in a futures position. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. The information contained on this site is the opinion of the writer or was obtained from sources cited within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in market prices. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
All information, communications, publications, and reports, including this specific material, used and distributed by Walsh Trading, Inc. (“WTI”) shall be construed as a solicitation for entering into a derivatives transaction. WTI does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71.