Analyst Suderman says soybean market is ‘very vulnerable’

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Analyst Suderman says soybean market is ‘very vulnerable’

Even though USDA’s supply and demand report on Friday featured little in the way of big surprises, corn and soybean futures closed the day with sharp gains.

Market analyst Arlan Suderman, in remarks made during a Friday afternoon webinar, said while he was pleasantly surprised with how soybean futures reacted, he also has some concerns.

“I am very concerned about near-term, especially soybeans. They are technically very overbought and USDA gave us no fresh fodder for the bulls today,” Suderman said. “I would suggest it’s very vulnerable right now.”

And Suderman said that applies to corn as well.

“A lot of it depends on what we continue to see on a day-to-day basis out of China—and when we get those new TRQs for corn.”

TRQs are China’s 2021 Tariff Rate Quotas for importing corn.  China is expected to raise those quotas, which could be positive for U.S. corn sales to China.

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Based on its survey of damage caused by the derecho wind event in August, USDA lowered its estimate of Iowa’s harvested corn acreage by 550-thousand acres.

Suderman said that equates to about 112 million bushels.

“That doesn’t include yield loss and harvest loss on those acres that were not destroyed—and that’s going to take some time to figure out yet,” he said.

Most estimates of damage right after the derecho placed the bushels lost in a range of 100 to 300 million bushels.