the good,the bad,the ugly,

John WalshGeneral Commentary

The soy complex is fighting on many fronts. The good in the market at present is that the domestic carry has fallen to a more reasonable level. What happens going forward will dictate if we have a 300 carry or a 500 carry. This is important because the market is probably in a range if we stay around 400-450 mil bu in carry over. The Chinese demand story can assist this story for the positive if purchases continue. The bad in the market is as follows in my opinion. The Global production remains more than ample. The Global carry while in decline is still much larger than the last few years. In addition it is projected that the southern hemisphere will make advances in production and add back to the global numbers. This could continue to compete with the US for exports. The potentially Ugly part of the market is that China may not need to buy more beans than the projections. This limits growth for beans and would be longer term negative. This is being fueled by the African Swine Fever that is still not contained in China,and is advancing in neighboring countries. These are big trends that change slowly. It has been my thought for some time that the oilshare will make gains,not only due to the global demand for vegoils,but due to the reduction in needs for protein from the above mentioned ASF. The market has alot to digest. This could create uncertainty and lead to a difficult choppy market. As always these are offered as my thoughts and a quantified approach is advised.