Soybeans hit new contract highs almost every day of the first full week of 2021, AgweekTV's Michelle Rook says. With export demand and some interest from new buyers, where do soybeans go?
Rook was joined by Randy Martinson of Martinson Ag Risk Management in this week's Agweek Market Wrap, sponsored by Gateway Building Systems.
Martinson believes the future of the soybean market will come down to what happens in a stack of reports coming out from the U.S. Department of Agriculture on Jan. 12.
"I think a lot of questions will be answered on Tuesday," he said.
Since market analysts have been predicting a friendly ending stocks report, Martinson said he thinks the price might go up initially before a sell off beings.
"I'm looking for the market to fade," he said.
But other factors still remain to influence the market, including how much the South American corn and soybean crops shrink. Martinson expects the outlook for the Argentina crop to be cut, while he doesn't see much for changes in Brazil.
Corn, Rook pointed out, got above $5 per bushel this week. Even though it didn't stay above that mark, some farmers were able to take advantage of the improved price. Martinson said ethanol plants reported taking in corn.
"There are trucks lined up," he said.
He doesn't expect corn stocks to be as tight as soybean stocks in the upcoming report.
Wheat, meanwhile, continues to lag, and Martinson predicts both corn, soybeans and maybe even canola could take acres away from spring wheat. And while winter wheat seedings, also to be announced in a Jan. 12 report, could be up, "whether or not we keep those acres is another story," he said. Rook explained marginal winter wheat acres could be "torn up" and planted to other crops.
The cattle market continues to drag on the slow pace of vaccination for COVID-19. Martinson said prices for upcoming months are low, but the market for summer months shows optimism that demand will return as more and more people get vaccinated.
The feeder market faces some difficult in moving up as feed supplies, like corn, continue to increase in price.
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