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Did the bears win the latest soybean price battle?Did the bears win the latest soybean price battle?

Kevin Van Trump

September 13, 2016

4 Min Read

Soybean bears also won a battle yesterday as the USDA elected to aggressively raise their yield estimate higher form 48.9 to 50.6 bushels per acre.

In turn U.S. soybean production was forecast higher by +141 million bushels. Total production is now forecast at a record 4.20 billion bushels, up another 3 percent from last month and up 7 percent from last year. Demand was bumped higher as well but it was simply not enough to offset the gains in production.

In fact new-crop ending stocks were actually raised higher by +35 million bushels, despite higher estimates for both exports and domestic crush. From my perspective the U.S. soybean crop looks looks really good, but I'm wondering if this might be the highest estimate of the year as more widespread disease complications are being reported in some very high production areas.

I have a hunch the top-end of the bean yield could start taking a few steps backwards in some important areas as we move forward. As a producer I want to stay patient in regard to pricing any additional bushels, at least for the moment.

I suspect as long as yield estimates and crop-conditions stay this elevated price rallies could be extremely limited. I'm hoping once we get deeper into harvest and the media starts reporting more on the disease complications out in the field, the yield might start to be talked a bit lower.

In other words this might be the highest soybean yield estimate of the year. I'm also thinking we eventually start to see more headlines develop around upcoming South American weather uncertainty.

Below are some of the additional highlights from yesterdays USDA soybean data:  


  • World soybean production raised from 312.7 to 330.4 MMTs 

  • Brazilian soybean estimate left "unchanged" at 96.5 MMTs

  • Argentine soybeans raised slightly higher from 56.5 to 56.8 MMTs

  • China soybean crop raised higher from 12.2 to 12.5 MMTs. Chinese soy imports surprisingly lowered from 87.0 to 86.0 MMTs 

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State-by-State Yield Changes: Below is the USDAs most updated yield estimate for soybeans on a state-by-state scale. The Illinois and Kansas crop was raised higher by +4 bushels per acre; Indiana, Kentucky and Tennessee yield raised +3; Arkansas, Michigan, Minnesota and North Dakota +2; Iowa, Missouri, Ohio and South Carolina +1. The Virginia yield was lowered by -3; Georgia, North Carolina, Pennsylvania and Texas were lowered by -1 bushels per acre. 


About the Author(s)

Kevin Van Trump

Founder, Farmdirection.com

Kevin is a leading expert in Agricultural marketing and analysis, he also produces an award-winning and world-recognized daily industry Ag wire called "The Van Trump Report." With over 20 years of experience trading professionally at the CME, CBOT and KCBOT, Kevin is able to 'connect-the-dots' and simplify the complex moving parts associated with today's markets in a thought provoking yet easy to read format. With thousands of daily readers in over 40 countries, Kevin has become a sought after source for market direction, timing and macro views associated with the agricultural world. Kevin is a top featured guest on many farm radio programs and business news channels here in the United States. He also speaks internationally to hedge fund managers and industry leading agricultural executives about current market conditions and 'black swan' forecasting. Kevin is currently the acting Chairman of Farm Direction, an international organization assembled to bring the finest and most current agricultural thoughts and strategies directly to the world's top producers. The markets have dramatically changed and Kevin is trying to redefine how those in the agricultural world can better manage their risk and better understand the adversity that lies ahead. 

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