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Advisor
Posts: 4,018
Registered: ‎05-03-2010
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How bad is the drought in Argentina?

After putting $1.00 on the soybean market, due mainly to the drought in Argentina, investors are trying to figure out if the weather-driven rally has further upside?

 

How bad are things for farmers in Argentina? Well, the cows have been turned out, according to the guy that I follow on Twitter.

 

Cattle In beans.jpg

 

What say you? Do you think the market has more upside, here, or will the China/U.S. tariff trade row cap gains?

 

Mike

Honored Advisor
Posts: 5,547
Registered: ‎01-10-2012
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Re: How bad is the drought in Argentina?

[ Edited ]

I've had cattle get a fence down and get out too.

 

Those cattle look like they are steaming from running, all bunched up, not like they were just let out.

 

More like they were just gathered up from being all over where they didn't belong.

Honored Advisor
Posts: 5,547
Registered: ‎01-10-2012
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Re: How bad is the drought in Argentina?

Yes those beans look haggard

 

 

"

The Grain Exchange is now rating the soybean crop in general as 45.3% very poor, 30.7% poor, 21.1% fair, 2.6% good, and .3% excellent. The early planted soybeans are rated 72% poor to very poor, whereas the later planted soybeans are rated 85% poor to very poor. The earlier planted soybeans had relatively good weather last September and October, but the later planted soybeans have endured adverse weather ever since they were planted.

The soybeans in general are 35% filling pods and 5% mature, so the next few weeks will be critical for determining the final soybean yield. The soil moisture for the soybeans is rated 52.9% very short, 34.1% short, 12% favorable, 0.8% optimum, and 0.2% wet."

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Senior Contributor
Posts: 364
Registered: ‎08-02-2012

Re: How bad is the drought in Argentina?

I would say their in trouble for sure, However for the worlds largest soybean exporter SA should be far more then 1.00$ correction. Just in world stock supply I would say about a 3$ correction would be more accurate.
Honored Advisor
Posts: 5,547
Registered: ‎01-10-2012
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Re: How bad is the drought in Argentina?

Reports of Brazil's bean crop getting bigger. Paraguay and Uruguay crops are abundant too.

 

Sold beans about noon for $10.24 cash.

Honored Advisor
Posts: 8,250
Registered: ‎07-18-2011
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Re: How bad is the drought in Argentina?

Well the opposite side of the market will have a time at bat.... before another run up in the next inning.

 

Those beans look trampled by something.... but IMO the market is usually overly optimistic and the producers are usually pessimistic.  

Seems like most of the information about argentina drought is coming from the optimistic side..... so it could be that bad.

It is kind of late south...... and the too wet brazil folks along with the too dry areas will definitely put a floor on the market for a while...

 

It looks like spring here is setting up the same way.

Honored Advisor
Posts: 8,250
Registered: ‎07-18-2011
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Re: How bad is the drought in Argentina?

This quote from FCStone...... headlines their report......

 

"Wheat ratings holding after winter declines; grain prices consolidating pre-USDA"

 

 

That statement should be followed by a "please"   or "we hope"  statement......   

 

Overly optimistic..... and very misleading

 

 

Honored Advisor
Posts: 8,250
Registered: ‎07-18-2011
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Re: How bad is the drought in Argentina?

Those beans are still green........ 

Veteran Advisor
Posts: 3,690
Registered: ‎02-11-2013
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Re: How bad is the drought in Argentina?

I think the story being missed is the drought
In the u.s.
When you have extreme fire warning...and we
Thought we had two big fires this
Morning that turn out to be blowing dust
We are in serious trouble.
Honored Advisor
Posts: 8,250
Registered: ‎07-18-2011
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Re: How bad is the drought in Argentina?

cheapo lets see if usda can change this in one report..   It will take a lot more than just a bad report.

 

history.png

 

Notice how significant todays 7 cents down is....  Argentina and US both having problems does figure on the world viewpoint...

But they want to ignore it so far...... and I agree with you...... It appears the US drought is a bigger problem..... maybe that is why they are talking about argentina.... they probably expect that one to get better first.