Soybean prices continue to trade in a range of between $9.20 and $10.20 per bushel. The bulls argue that global demand remains extremely strong and that U.S. production might not be as robust as the USDA is currently forecasting.

South American weather will remain a huge "unknown" for several more months and at some point might prompt the trade to add additional risk-premium. That is something we will be keeping a close eye on as we move forward. Nearby, moisture in the forecast has unimproved across allege portion of Brazil. The Chinese have been strong buyers as of late, but are now on a major holiday, so there's some question as to how their mood will be when they return?

As for today, most inside the trade are wanting to see if the USDA makes any major adjustments out of the rearview mirror, which they did. The USDA's bullish news is the fact last years crop was revised lower by -10.6 million bushels. Harvested acres were reduced by -40,000 and the 2016 yield was lowered slightly to 52.0 bushels per acre. Also bullish is the fact old-crop stocks are now estimated -44 million bushels lower than our most recent report.

The trade also seems somewhat split on total new-crop production. Will there eventually be an adjustment lower to yield and or will planted acres be bumped higher? Bottom-line, demand continues to impress and remains strong form a global perspective. Unfortunately for producers and bulls inside the trade there remains ample global supply. As a producer, with 80% of my new-crop production already priced/hedged at good levels,

I want to remain patient in regard pricing any additional bushels, even though I'm worried about the nearby downstroke. I believe as global demand continues to grow especially Chinese demand, the slightest production hiccup could create a nice pop to the upside.

As a spec, I believe there is still more room to the downside nearby and want to get past the U.S. harvest before looking at a more aggressive longer-term bullish position.

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