Bower Trading Market Strategy Report: Demand Grabs Market’s Attention
The corn and soybean market is switching its focus from supply to demand. As combines resume harvest this week, growers will be focusing on yield. Jim Bower, with Bower Trading says the market, which has been focused on supply, is now shifting its focus to the demand side of the equation, “The demand for soy and soy products globally, particularly our of China is phenomenal, running at a pace well ahead of last year.” He added that this reinforces the fact that lower prices will spur export demand. As a result, Bower says producers need to consider their marketing options, “At Bower Trading, what we have done is move soybeans when the price is close to the $10 mark and then repositioning back in the bull spreads going into next year to give the market plenty of time and room to move.”
Another market factor to keep an eye on is the very slow pace of planting of soybeans in Brazil, “I have a graph that shows how far behind they are on planting progress. Now it is not a disaster yet, but they are running well behind the 5 year pace of planting.” Over the weekend, temperatures reached over 100 degrees in some of the key soybean growing areas of Brazil. Bower added that, not only could this reduce their production for 2018, the uncertainty of their production may prompt their producers to hold back on exports in the last few months of 2017.
For more market strategy information, contact Bower Trading at 800-533-8045 or bowertrading.com.
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