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Seasonal marketing pattern flipped upside down by Brazilian soybean shortage

A Brazilian soybean shortage has flipped the seasonal marketing pattern upside down.

DTN lead analyst Todd Hultman tells Brownfield the soybean market is challenging its highs for the year when it normally bottoms out going into harvest.

“Typically Brazil has plenty of soybean supplies coming off a big harvest as they had earlier this year, and we would expect them to keep exporting at least deeply into the fall. But that wasn’t the case. They actually ran low on supplies earlier than usual, and that was signaled by the higher prices that we saw in Brazil in late July.”

He says there is still a lot of downside risk and encourages producers to consider both old and new crop sales.

“It’s very hard to just count on China exclusively, but I think we need to reward this bullish surprise.”

Hultman says while Chinese purchases of U.S. soybeans are surging, China is still woefully below targets set in the phase one trade agreement.