Soybean producers in Argentina seem a bit disappointed by the early devaluation of the peso. Many analysts and insiders thought that once the Argentine government allowed the peso to float freely it would immediately devalue to around 15 pesos to the dollar. Even though it devalued on the first day of free-floating, it seemed to be a bit of a disappointment to the market and didn't spur as much farmer selling as anticipated.
I'm also starting to hear more talk and rumors that many farmers in Argentina might not be so sold on newly elected President Macri's economic plans. Worrying that "rip-your-face-off" type inflation and more extreme social unrest is perhaps a better reason to continue holding back bushels rather than being aggressive sellers like the government is encouraging. We all know that farmers in general are a bit leery of fast-talking business types with a so called "perfect plan" that involves selling their crop production.
Like I said a few weeks back, it all sounds great on paper or when you say it real fast, but getting the people and the communities to buy into the plan and cooperate peacefully with the transition is a bird of an entirely different color! Bulls inside Brazil continue to talk about more problematic areas to the North. Several insiders are saying conditions in many locations are much worse than analyst or the trade has been willing to recognize. I should also note that Informa reduced their U.S. soybean planting estimate for next year by around -800,000 acres. Unfortunately, they're still projecting more soybean acres than this past year and still near record levels. I personally think soybean acres will be less than this.
Bottom line: It's all about South American weather and politics right now, two headlines that remain extremely unpredictable.