Soybeans hit the $12 dollar mark early on during the overnight session, but then backed off a few cents in a technical move.
South American weather is still the primary reason as several Brazilian states continue to face dry weather. A commodity weather analyst says that one-third of the country’s corn and soybean acreage has long-term deficits.
Export sales are also up 117 percent over the same time last year, leading all of the grain markets higher overnight.
The big question is will it last?
The latest report from the commodity futures trading commission gives us some insight. Money managers reduced their net-long positions in both corn and soybeans.
It was the smallest number of net-long positions on soybeans in more than two months, and the smallest amount for corn since about a month ago.
Net-long positions indicate traders see prices going higher, but in this case, they are betting on futures declining soon.
Commodity prices have been doing fairly well these past few weeks. One grains market analyst calls it somewhat of an anomaly.
Dr. Kim Anderson, with Oklahoma State Extension, states, “If you look at the United States all wheat, last year we had over 1 billion bushels projected... 877 million bushels now... That’s below the five year average... So, what we’ve go is a tight hard wheat bread flour stocks, and the world reacted to that with higher prices.”
Those numbers come from the November World Supply and Demand report. December’s update is due out on the 10th.