It looks as though the basics of supply and demand are at work in a dramatic way in the soybean market to the point where soybeans could return to the highs of 2008. China is leading the charge on the demand side both from the consumer and the livestock end with growth in global demand adding to that pressure. On the supply side, there have been a number of areas that under-performed. South America is the area that most surprised analysts with the latest numbers showing production down 12 to 13 million metric tonnes. This coming after expectations of a record crop. With supplies already tight, any other bump in the road on the production side could push soybeans back to those 2008 highs.
At farm tradeshows this winter across Ontario and the Mid-west, farmers are licking their lips for the potential profit that soybeans may bring to the farm in 2012.
In this episode of the Soybean School, we talk to Market Analyst Moe Agostino of Farms.com about the bullish story surrounding soybeans and look more in-depth at some of the factors influencing that market.
If you cannot see the embedded video below click here.