USDA Reports More Supplies, Sends Soybean Futures Down Hard

Soybean futures whipsawed with crazy volatility yesterday after the USDA stated domestic soybean inventories actually increased since the last reporting. The soybean futures official news sent the market .36c lower after the report yesterday and never looked back.

The domestic inventory, according to the USDA as reported yesterday, reached just over 2.5B bushels – the most since 2006 and can be compared to the prior year’s bumper crop of 2.15+ billion bushel in the same reporting period last year. The USDA went on to say they claim overall global inventories before this years harvest (in the Northern Hemisphere) will be the highest ever recorded.

Barb Levy, chief director for The Fox Group’s futures division in Chicago, shared her fundamental analysis insight regarding the current soybean futures situation by stating, Domestic & int’l soybean production being larger than expected means ample supplies into the next harvest.” Levy adds, Expect soybean reserves to build nicely now that we are experiencing record production in consecutive years.”

The trend for soybeans is down from early December. Before today, soybean futures had been in a position to breakout into an uptrend, but now I think any chance of that soon happening will take a back-seat in the foreseeable future.

ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.