November 9, 2012

For the last two months, US soy prices have declined and prices could go either way in coming months.

According to the University of Illinois agricultural economist Darrel Good in a press release, soy prices reached a peak on September 4, when November futures traded for US$17.89 a bushel. The price has since declined to the US$15-a-bushel range.

Exports of soy are strong, but Good said the market expects the US soy harvest to be larger than the October forecast. The market also seems to anticipate a bigger South American soy harvest in 2013, he added. Both of those factors point toward lower prices. But Good said bigger crops are not assured, given weather uncertainties on both continents.

"With current unsettled weather conditions and large crops needed in both South America and the US in 2013, the soy market may be understating production risk," Good said. "If so, modestly higher prices for the 2013 crop would be expected."