Ultra low old crop supplies and a record shattering harvest leads to wide trading spreads. With large coincident soy, rapeseed and palm harvests on the way, oilseeds prices will soften. Soybeans have fallen 31% in three months and it currently trades near US$10.40/bushel, slightly below levels last seen in late 2011. Moreover, while exceptionally tight pre-harvest US inventories supported prices through the first nine months of 2014, market support will begin disappear shortly after this article is published.
Late summer USDA reports low-ball crop yield estimates to prevent volatile market shifts. We examine how this year's real yield and harvest numbers will impact prices. Although the USDA boosted its estimated corn crop yield to a record high 167.5 bushels/acre it surprised everyone with its new-found conservatism. With the upward revision in yields, this year's record harvest size was upped 1.2% from the previous 352.1 million tonnes to 356.4 million tonnes.