There are few constants in life, especially the last couple of years. But one of the most consistent patterns has been the inability of USDA to accurate forecast soybean demand from China. The agency historically underestimates U.S. exports as a result, something that definitely happened with the 2008 crop.
USDA has upped its forecast for 2009, but sales are off to an even stronger start. Chinese demand keeps growing, with heavy purchases again last week that helped jump start the market into a nice rebound.
It's anybody's guess right now just high tight old crop supplies are. While basis broke sharply again last week, August/November rallied sharply into first notice day. But new crop enjoyed success, too, with November futures holding a bullish trajectory on the seasonal chart. This suggests the rebound could have legs, perhaps leading to a test of the June highs near $11.
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