WEEKLY SOYBEAN REVIEW: Argentine Rains Break Soybean Market Hard
Uncertainty if selling is done for time being.
Bryce Knorr
Published: Feb 23, 2009
Rains across Argentina over the weekend officially killed off the South American weather market of 2009, but futures had already anticipated the forecast. After falling almost $1 last week, the only uncertainty now is whether the selling is done for the time being.
That may depend on whether speculative hedge funds decide to turn bearish on beans. Up to this point the talk has been that fund managers want to own beans. However, Friday's CFTC Commitment of traders showed larger speculators cutting their net long position by almost 20,000 contracts — they're barely holding on to a small bullish bet. If the funds turn outright bearish, it may not matter what happens in outside markets like crude oil and stocks.
Bearishness in February over the long haul doesn't work in beans. Usually, this is the best time of the year to pick up options to speculate on spring and summer rallies. This year, however, those rallies could be muted by the two big dogs in this hunt — acreage and China.
To read Bryce Knorr's complete weekly soybean review, click HERE.
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