The Soybean Wars

May 21 Blog update:

In my July 2018 newsletter, I asked the question: Is it possible
that soybeans are the wheat of the 80s?

With the USDA announcement today of US$ 2 dollar
per bushel soybean payments, I think I have my answer.
For the government to announce something like this
during planting season is mind blowing. Many areas plant
soybeans until July- especially the double crop areas.

We have a situation where the market is telling the world
to back off 10 million acres or 15 million tons.
With a US$ 2.00 payment to USA farmer, that tells
them to put the pedal to the floor. It does not matter
if payments are decoupled and they use past history.
If payments are coming, the farmer will plant.

I think back to the 80s. I am a product of deficiency payments,
CRP, and grain storage programs.
I remember needing every penny we could get from USDA and
then along comes Gramm/Rudman and knocks 15% off our
checks in 1985. We need to balance the budget was the matra.

In the 90s we got paid on 85% of our base acres.

We put 36 million acres into CRP and in the 2000's
Brazil, Argentina and others add 36 million acres and
more to the world stage with the help of double crop acres too.

The national debt at the time was 5 Trillion. Today, it is damn near
22 Trillion dollars. Today, we receive notice that 20 billion more can
come in assistance. God, how we could have used that back in the
80s and 90s instead of fight for crumbs.

The irony of all of this is that if the USDA had the will power back in
the 80s to send out money like this and a reduced CRP program,
the USA could have bankrupted the Brazilian/Mato Grosso soybean
farmer before he had a chance to start.

By the time 18 dollar beans came along, the environmental oversight
would have nipped expansion in the bud -20% to 30% open instead of
80% in areas.

Today, I fear it is too late. If Washington thinks they are going to
break the Brazilian farmer- think again.
Today, Brazil enters the Real Trade war. This is now a fight
to the death. This is now a blood sport.

The trade war creates a strong dollar scenario and that only
entices them more down here. Soybeans are sold in dollars.

Brazil's infrastructure gets a little bit better each year. China is ready
to invest more into Brazil. The FX at 4:1 protects the Brazilian farmer
for the time being.

The Brazil farmer has said for over 10 years, "pay us something for
our reserve area and we will leave it alone." The 50%-80% that
new areas need left alone.

I sometimes wonder if it might have been cheaper for USA and the World
to have paid the Brazilian farmer an Amazon CRP payment of sorts to do
nothing with the frontier area, than to pay the USA farmer not to plant
highly erodible soils and wetlands.

With today's announcement, we will now find out who the low
cost producer is? How many 250,000 dollar planters do we need
to plant US$ 4 dollar soybeans in North Dakota?

Someone needs to blink, but 2019 is not the year. Unless we can freeze
these beans in Sept and knock 500 million bushel off, we have a paradigm
shift ahead with regards to soybeans as signifcant as Round UP ready
technology was to corn and beans- only in reverse.

How many years will soybeans be stored if the government payments
keep coming?

As my Brazilian friends have always said, you guys will be OK,
you guys have the Federal Reserve. You will just print more money.
It is no wonder Brasilians and others think dollars grow on trees.
Just go get some more. It is easy for you guys.

This is going to create more and more hard feelings between
hemispheres now. In 2018 Brazil and ARG could enjoy the
trade war and profit from it.

With MEGA government payments in phase II, now the bleeding
begins?  Who is first?


Kory

Keywords: Soybean history, government payments, trade war,
low cost producer, FX

April 20th blog update

It seems like most private crop forecasters have the

BR soybean crop at 115-118 mmt.

This is a marked increase since February.

Most everyone was in the 111-114 mmt club.

Aprosoja was the outliar saying the crop could

be as small as 101 mmt. 

I think it is worth noting how significant RGDS is in

soybean production. With the losses in Parana, RGDS is

the 2nd largest soy producer behind Mato Grosso at 18.7 mmt.

If we look back to the previous major drought for the southern

states, that was 2011-2012 crop year. RGDS came in at 6.5 mmt.

It was bad. Since then, acreage shift away from corn, rice and

productivity gains have allowed RGDS to rebound to near 19 mmt.

This is + 300% from their low point. This has nothing to do

with deforestation or expansion in the northern areas. This is simply

good farmers doing their best. 

We can look at 2018-19 crop year two ways. If this crop is at 

115 mmt+, then last year's crop was greatly understated. If we assume

8-10 mmt were lost from peak potential, that means last year was

a 123 mmt+ crop size and this year we had 125 mmt at one time. 

The flip side is: If last year's crop was 120 mmt, then this year's crop

size is too high and we need to look at Conab's numbers at 113.8 mmt

as being more accurate. 

Ths USDA at 117 mmt and the Brazil FAS office at 113.6 mmt is very

confusing. Does the left hand know what the right hand is doing?

Going into 2020, it sure looks like we can pencil in 125 mmt for a 

starting point for next year's crop. This is not what the USA farmer

wants to hear and the Brazilian farmer needs to grasp that there

are too many beans in the world. The trade war now has everyone

on equal terms. The 2018 BR windfall is over. That was a once in a 

lifetime illusion. March 2020 soybean premiums are only 8 cents

over CME. 

China now has North and South America by the short hairs. 

At the moment, FX is helping the Brazilian soy and corn farmer.

FX is helping them maintain profitability. 

The 2nd crop corn in Brazil will be beyond fantastic. 75 mmt + 25 mmt

for 1st crop should allow for a total corn crop output of 100 mmt+.

FS bioenergy has announced the site for their 3rd corn ethanol mill.

The plan is for two more- right place at right time.
The first mill is pumping out 1.5 million liters per day of ethanol +
DDG's. 

There is talk of a truckers strike starting April 29th. Contacts tell me

it is just a few on social media stirring the pot. Nothing will happen. We will see.

Brazil cannot handle another shutdown like last year. 

The new admin is between a rock and a hard place. They encouraged

the truckers last year as it was a political windfall for them to have this happen.

Now, the shoe is on other foot. Crude oil keeps rising and FX is near 4:1.

This was not in the plan back in January. This puts pressure on Petrobras

to keep increasing fuel prices every two weeks and this is squeezing the

truckers again. Soy sales have been slow, so there have been trucks hauling

freight for below the minimum price table. This table is still being reviewed

for its constitutionality. 

The new admin wants to privatize Petrobras, but just last week the govt

intervened and asked Petrobras to delay a fuel price increase as per fear of

a truckers strike. They cannot have it both ways.

The FX market looks at these shenanigans with fear that the govt will also

fold their hand with regards to pension reform. Thus, we are hugging

4:1 again, which was not forecasted by anyone in January. We should

be trading at 3.30- 3.50:1 given the optimism at the beginning of the

year. Therefore, Brazil GDP forecast has now been lowered to 1.8% for

the year. 

I have heard that Representative Collin Peterson from MN, who is also the

Ag committee chairman, will be coming to Brazil and Argentina soon

on a fact finding mission to see how the trade war has affected and/or

stimulated other countries at the expense of the American farmer. 

How is China helping AR and BR with infrastructure?

I am happy to hear they are coming. I feel they are 20 years too late.

Given some of the projections I have seen for Brazil's production

by 2025 and 2050, we need not be producing soybeans north of I-94

in the USA. 

Climate change, resurgence in Chinese soy demand post ASF, FX

distorting and incentivizing production, and railroad expansion will

all play into Brazil's hand in the coming years. 

I mentioned this to clients several years ago as China evolves

in her food needs. I said, what if China can't get soybeans fast enough

because of factor X?  Maybe they decide to buy Brazil Foods, turbo-charge

chicken and pork production within Brazil, keep the beans here, crush and

make into feed here, and then just ship the end product to China?

If ASF would last a number of years?  Is the above such a crazy idea?
Of course this would be a boon for livestock producers around the world

as China searches for protein in the mean time.

If something like that were to happen, think of how that changes Brazil's

logistics needs?  We flip from huge bulk grain volumes at ports to 

refrigerated warehouses storing meat in containers. We would need

more soy crushers and more corn ethanol mills. DDG's would be in

high demand. Huge increase in Brazil soy and corn storage capacity to

hold grains year around for processing. Could that be Brazil's future

by 2050?  Damn right it could be, maybe even by 2030 if a renewed

search for protein ensues. 

Thank you for all the newsletter renewals and VIP retainers.

I have been doing this for over 15 years now.

I am not sure where the time has gone.
My son is taking Brazil college exams and also the USA SAT is
given 4X per year here in Goiania. Who wudda thunk? 

The more Brazil trys to change- the more she stays the same

i.e. Petrobras and fuel pricing drama.

For those outside South America, one needs to watch the ARG election

in Oct. It will be important that Macri wins again. If ARG would go LEFT,

combined with weak FX in Uraguay and Venezuela problems, that would

be a stiff head wind for Brazil to tolerate going forward. It would lead to

a weaker REAL. 

Regards

Kory

Keywords:  BR soy and corn, corn ethanol, trucker strike, FX, 

protein shift dynamic long term, USA Ag committee junket to BR and ARG, Trade war,
ARG election Oct 2019

March 3 blog update

Happy Carnival

Brazil is in party mode for a few days.

People seem to forget the dam collapse just a month or
so ago. The situation was handled terribly.
Many still unaccounted for.

The rains have returned and thus the soybean crop
has stabilized. I am at 114 mmt. Others are thinking
115+ and yet others are down in 106-108 area.
We need to keep in mind that the potential was 125
back in December. Therefore, even a 115 number
is 10 mmt off the highs. That is still 360 million
bushel gone from the peak. The drought was significant
in various regions. Historically, it has to be really bad
to lose more than 15 mmt. Those that were thinking as
low as 101 mmt in January were seaking headlines.
I outlined all of this in newsletters and flash updates.

Yields out of Argentina are fantastic. Rain makes
grain. Look for soy and corn numbers to increase even
more down there.

There has been flooding in Mato Grosso and Para state.
This means the early planted 2nd crop corn will be beyond
fantastic this year. Early corn is ready to tassle. With rains
of up to 8 inches in last two weeks, much of the crop
is already in the bag.

Brazil 2nd crop corn

65 mmt crop is already in the bag
70 mmt is likely
75 mmt is not outside the realm of possiblity
80 mmt is being whispered about by some.

80+ 25 = 105 total   maybe ???

Cotton area expanded by 33% so that has inhibited corn's
ability to shoot the moon. Bottom line: there will be
plenty of corn.

With the excess rains, BR 163 has turned into a 70 km long
truck stop. Some trucks have been sitting for 5 days.
No food and all they have to drink is rain water.
Tempers are flaring now.

The military did pave 45 km last season of the last
90 km to get to Mirituba. From Mirituba to Santarem,
there are a few more KM that need to get covered.
They stopped because of lack of material.

Three weeks ago, the new Minister of Logistics went for
a truck ride himself to see the conditions. The drought
was still intact so he was still able to move.

As the truckers say, come out here now, take another
ride and sit with us out here for a week with no food.

The Mayor of Novo Progresso is pleading with Mato Grosso
grain shippers to stop sending trucks. There is no room.
3000+ trucks are stopped.

It is 70 reais a ton cheaper to send soy north compared to
Santos via rail. Either way the grain buyers lose money.

Demurrage going north or higher freight going south.

Farmers are holding on to 2nd half of soybean crop.
They want higher prices.

Port premiums rallied last week and then backed off.
End of trade war has grain buyers worried.
Port premiums might need to go negative in order
to compete with USA and China bids.

I will be going to Mato Grosso March 25th for a week.
The BR 163 Show Safra will be record large again.
I am curious to see the pace of equipment sales
given the crop came in a bit light and cost of
production is on the way up.
Dollar FX  3.75:1

In early April, I will send out a special newsletter
as per my trip. Drop me a note to subscribe.

Thank you for all the kind notes in recent weeks.
Much appreciated.

Kory

Key words:  Mato Grosso soy, BR 163, trucks, rains,
Show Safra 163, 2nd crop corn size

Feb 10th blog update

Back to trend line yields

Harvest is zipping along in Brazil. The hot December 
and January took its toll on some fields. The general 
commentary from producers are that yields are 
coming in 10% less than last year's record productivity.

The USDA is still too high as per Brazil 2019 production.
But they are a lagging indicator especially when the 
government was not working for a month.

2018 was a late planting year but ideal weather made for a 
record crop.
2019 was ideal planting date but late season stress mixed with 
an above average amount of early season soybeans nipped 
them in the 8th and 9th innings. More than likely the 2nd 
crop corn and cotton will make up for the shortfall of the 
first crop.

Bottom line is that from the drought of three years ago, 
the sudden rise in soybean production from 95 mmt to 
122 mmt was the outlier not the norm.

The Brazil stock market has been trading at record highs. 
The Dollar has been weaker in Brazil until this past week. 
The dam break was not good for Vale. President Bolsonaro 
is back in the hospital for a follow up procedure due to his 
stabbing during the campaign. The fear is that this
will delay negotiations on the social security reform bill. 
Brazil has ambitious ideas to try and cut ONE TRILLION REAIS from budget over the next 10 years. This will be a heavy lift.

The big news in the media this past week is the continued talk that
Brazil will overturn the limit on foreign land ownership that was
implemented under Lula to help Dilma back in August of 2010.
In March, it will have been 8.6 years since this policy shift.
Cyclically, this is interesting as we might be on the cusp of another
policy shift. With the Dollar FX at 3.70:1, this does make Brazil assets
seem cheap again to foreigners.

The Bolsonaro position is that Americans are welcome. Brazil is also waving the need for tourist visa for Americans this summer. 

From June 1 through September 18, tourists from the US, Australia, Canada and Japan will be able to enter Brazil for up to 90 days without a visa.

Mato Grosso implemented an updated FETHAB witholding tax for soybeans,corn, cotton, and cattle on Feb 1. Farmers are not happy with quick application of a new tax that actually seems like double taxation for many on the same hectare.

There is also much banter in media that the "Grain Railroad" will be approved in 2019. This the rail from Sinop to Mirituba, Para. The Minister of Logistics took a ride in a soybean semi-truck on BR 163 to see the condition for himself.

He promised that BR 163 paving will be completed in 2019. This is a huge factor for 2020 grain movement to the north. 

The FS energy corn ethanol mill at Lucas do Rio Verde has completed its doubling of capacity. They should be at 400 million liters per year now or the 100 million gallon size. Construction has started on the 2nd mill at Sorriso. This will also be a big one.

Impasa mill at Sinop was approved for increased warehouse capacity at thier site.

They are now building 3 - 200,000 ton warehouse to store corn. That is 24 million

bushel of onsite corn storage. Mato Grosso corn in the future will stay in the state and be made into fuel and DDG's. It is truly a paradigm shift. 

Mato Grosso will likely produce 1.1 billion bushel of corn this season again. 

The Ag shows have started with Show Rural in Parana this past week.

I am eager to hear results.

The Show Safra 163 in Lucas do Rio Verde is the last week of March. It will be record large. I know CASE IH Brazil has sent a record large 

order  to Steiger Tractor in Fargo, ND for 2019 for their 4 wheel drive articulated tractors. The modernization of the BR fleet continues. 

Producers are very happy with the new administration. However, the late season drought and the application of new taxes has a catch 22 feel about it. 

The vicissitudes for the Brazilian producer continue. It is an occupational hazard. There are so many positives on the horizon, but there always seems to be a counter force that keeps things in check. 

Keywords: BR soy crop, Grain Railroad, Fethab, Budget,Corn ethanol, Case IH

Brazil: A New Day

Brazil's new President has taken office.

He has made some policy moves that favors the rural coalition.
He made good on some campaign promises to help farmers deal
with environmental issues and Native Indian lands.

This will help him with votes he needs later regarding pension
reform and budget cuts etc.

The Dollar:Real FX has dropped from 3.90:1 to 3.70:1 in recent weeks.
Soybean bids have also dropped with advance of harvest.
Banks think the Real can trade at 3.80 for most of 2019.
Technical analysis shows a possible break to 3.20:1.

The Conab report came in as expected for me. I have seen this before that,
when there is a drought, they tend to wait until February before any
significant adjustments. Most of the data they had was based on December
and most of the last 30 days people have been on vacation.

The yields I hear out of Parana indicate 50% of a crop in the western
1/3 of the state. This region accounts for about 40% of Parana total.
Parana crop conditions are 50% Good, 30% average, and 20% poor.
It is said that in several counties that soybean harvest will be wrapped
up in the next 10 days. The 2nd crop corn is going in very early.
Parana's true soy crop size will show up in the February Conab report.

Mato Grosso: Western 1/3 of the state has fantastic yields.70 sacs per/hectare
or 63 bu per acre is common.

The BR 163 corridor is coming in 10% light on early beans. In general,
if the yield was 60 sacs last season, they are coming in at about 54 sacs
this year. Later beans should be back to normal.

Goias things are going quite well. It sure is a wet drought. Two weeks ago
it rained every other day. This past week was dry and then Saturday
evening a very nice rain again. State wide?  No
But it is raining.

Forecast is dry thru end of the month. Bahia and points to NE need
to be watched. This is a critical month for them.

Mato Grosso taxes:

On December 31, the Fethab II regional witholding tax was retired.
This, in essence, increased the net price to Mato Grosso soybean
producer by 60 centavos per sac for 2019. Good news.

However, Mato Grosso is in dire need of new revenue. The new
Governor has proposed a new elevated Fethab tax rate for cotton,
soy, cattle and corn. Corn is a new addition to Mato Grosso witholding.
There are two levels to this tax. One for domestic sales and one for exports.

I will be keeping various VIP clients that have vested interests in Brazil
updated on this. If there is a new Fethab, I do not think it will be applied
until the July 1 Fethab update. That means it will be more of an issue for
corn and cotton marketing than soybeans.

Soybean crop size and technical prices to watch:

SX 19 soybeans made a high at 9.64 this past week. So far 9.71 is
strong resistance as well as the 200 day MA. A trade at 9.72 1/2 tells
me we are moving higher. A trade at 9.70 or less and a reversal lower
tells me we need another wave lower. If we do make a run at 10 bucks,
make damn sure you sell it. 2018, 2019 and even look at 2020.

Clients know where I am at on crop size and where I think we will be
in two weeks.

We have a range from 104 mmt to 119 mmt among experts.
115 mmt- market does not care
110 mmt will have markets attention
below 110 mmt- we have a story for 2019

I think what is confusing to many is that the past two years
we had near ideal weather conditions combined with application
of the lastest genetics and precision ag. This allowed for two back to
back 10 mmt increases. Some assumed this the new norm.
Thus 130 mmt was mentioned a month ago.

We have expanded area, but maybe not quite as much as we thought
earlier. So now we start to cut productivity on a very large base.
Whoosh- the millions of tons disappear that once were thought to
be baseline.

Thus, the last two years I have been conservative on the way up
and have been wrong. Example: last year I was thinking 113 mmt
with outside chance of 115 mmt.  Final crop size circa 120 mmt and
given exports for 2018, the crop was likely 122 mmt+.

The maximum potentials were already dialed in last year.

I have been hesitant to drop to low too quickly as per experience
in the USA the past two years. We have a drought or flood and we
produce record yields. The stress did the beans good.
Thus, we need to be careful here too on the way down.

Brazil has damn good farmers and they have invested heavily into the
newest technology. This crop will not give up easily.

The issue in Parana and MGDS was not so much lack of rain but
the combination of intense heat at pod fill and a root fungus
that caused the beans to die early. It was like the soybeans were
micro-waved. This gave the illusion that beans were killed early-
intentionally- they were not.

I will update more to my subscriber list.

Drop me a note if you are interested in more real time info
and not info that is 2-3 weeks old by the time it comes
out in general media.

agturbobrazil@yahoo.com

Thank you to all the VIP renewals for 2019.
Much appreciated

keywords:  BR soy crop, Mato Grosso tax, weather, crop conditions, yields

Dec 24th update

Parana received some rains over the weekend.

This will help later planted soybeans. Early soybeans
have been hurt by three weeks of drought.

I think the new mega crop for Brazil is overstated.
I think we have a crop size similar to last year on deck.

It would take a dry January and Feb in Northeast to subtract
more from current potential.

9.71 on the SX19 contract proves to be resistence for now.
If one looks at historical charts, it makes sense.

Dollar remains at the 3.90 level. This seems more to do
with international events than domestic.

Brazil seems like it will ship out 84 mmt in 2018.
If so, 2018 crop was likely larger than published.
Some of the extra came from Paraguay.

The crushing industry had to submit to the export bids
this year and throttle back.
This adds pressure to chicken and hog sectors in Brazil
as per feed rations.

At the moment Brazil and USA are at par for new crop
export bids.

With the declining hog herd in China, I think if China
buys circa 5 mmt of soybeans from USA, that stabilizes their situation for
now.

Brazil will have exportable supplies in two weeks with early burn down
of the 90-95 day soybeans that were planted. This was a mistake
for many, but they will make it back with early planted 2nd corn.

So long as Brazil has 80 mmt to export in 2019, China really does not
need anymore beans until Oct/Nov/Dec 2019. Remember, Argentina
will rebound 15 mmt+ this season also.

What if??

Yes other countries will pick up some of the slack. But China was a 32 mmt
customer for USA, if that drops to 5 mmt, that leaves 27 mmt that needs a 
new home. Let us say 7 mmt finds a new home.

20 mmt = 740 million bushel needs to be carried forward.......

If we are optimistic and USA and China pull off a mega deal and
China buys 20 mmt this spring, then 20 mmt will be added to
Brazil balance sheet for 2020.

In the end, someone is going to be holding 20 mmt?? Who will it be?

The American soybean payment could also be looked at as a nice storage
payment like in the 80s - paid to store grain for years. But it looks like
this is a one off payment. A farmer could take a loan on the beans
this winter which would get him to Sept 2019 before delivery.

SX19 needs to tell American farmer to tap the brakes.

If USA farmer does not, then March 2020 contract needs to tell
Brazil farmer to tap the brakes?
Brazil farmer at moment has 3.90:1 dollar working in his favor.
If that drops back to 3.30, Brazil farmer no longer has life
insurance policy for 2020.

It's going to get interesting. There are going to be tears somewhere.
Who will it be?

There is a tsunami of soybeans out there. If no deal, American farmer
is the last one standing when the music stops with no chair to sit in.

If there is a deal, then it will be the Brazilian farmer standing with no
chair to sit in this year at Carnival when the Samba stops.
Carnival is late this year. March 1-5th  wink wink

I watched a Netflix series this weekend. It was called Pine Gap.
As in Pine Gap, Australia. The secret USA/Australian base
that monitors communication and movements globally.

In the program there was a Chinese businessman trying to do
a natural gas deal in Alice Springs. He made a comment in the last
episode that made me chuckle.

"In the USA, you teach your children to play Chess. The winner is who
can get the others King as quickly as possible."

"In China, we play a game called GOL. The winner is who can amass
the most territory and keep it the longest."

I thought this was an appropriate analogy for the current trade war.
Of course there are many things more important than soybeans at the
moment.

I sometimes wonder if Brazil and USA even realize the game they are in?

However, I think China has USA and Brazil by the short hairs going forward.
Both countries have become too dependant on China- each in their own way.
China is going to have cheap beans one way or another for the foreseeable
future.

Brazil has a 120 mmt crop. Maybe a bit more.
Even with a late season drought and a drop to 115 mmt, Chicago will
not care.

Ideally, USA and Brazil would each drop 10 mmt each of soy for 2019/2020,
but I fear both are too stubborn to do so.

Happy New Year

Kory

Keywords:  Soy, trade war, USA, China, Pine Gap, drought, soy econ

Dec 1 blog update

Happy Holidays from Brazil

2018 is coming to an end. From my perspective it cannot
come soon enough. The year has flown by, but jumping from
crisis to crisis all year gets old.

I have been in Mato Grosso and Sao Paulo states the past two weeks.
The crop looks great.

The week ahead looks wet. I am sure we will start to hear about
rust issues  etc. Most will apply 3 or 4 fungicide applications.

I do not lose any sleep over rust. Brazil farmers are too good at what
they do to worry about that.

The new President and Admin will take office Jan 1.
Many are optimistic about the start of 2019.

The soybean crop will be big as will the 2nd crop corn.
Sugarcane crop looks stable for 2019 but with a switch
back to more sugar than ethanol production.

Machinery sales should be good again in 2019.

As I write this, we will all be waiting for a tweet from Trump
sometime Saturday night. With all the option activity this past week,
Sunday night proves to be a big move.

A gap higher, we could say the lows are in and we have a market again.

A gap lower, then I fear we have another leg lower to go and we need to
find some sort of capitulation this winter to discourage soybean production.

A deal in early 2019 would not be good for Brazil farmer. Port premiums have
already retraced and would likely decrease even further. If the USA would start selling
beans again at peak harvest pressure for Brazil farmer, things could get ugly here in a
hurry if the Dollar:Real would revert back to 3.30 instead of 3.80:1.

Dollar at 3.85:1 is a life insurance policy for BR farmer for the medium term.
Jan thru March.

Are we 50-60 cents higher next week or 50-60 cents lower.
This will set the tone for the next few months I think.

USDA production reports in January. USA crop insurance guarantee pricing
in Feb. March 31 planting intentions and a 500 million or a 1 billion
bushel carryover. PNW freight pricing and storage space at ports?
Booking of ocean freight?

This is starting to look like a multi-year issue to chew through all of this.
A private BR consultant is at 125 mmt for BR with outside chance of 129 mmt
of soybeans. Uff-Da
The drought year 3 years ago we were at 95 mmt.
I would have never thought we could be at 130 mmt so quickly.

Many Many moving parts. I do my best with info from China, ARG, BR, and USA
everyday.

Look for a few early soybeans to be ready about Dec 25th.(cotton ground)
The next block will be ready Jan 5th. By Jan 15th, Parana and MT will be in
full harvest mode.

Drop me a note if you are interested in becoming a subscriber at one of the
levels listed on my site.

Happy New Year to all,

Kory

Keywords: BR soy, prices, rust, G-20, Trump Tweet, soy gaps

* I will send out special Conab highlights report Dec 11th.