What Do the Soybean Bulls Know

What Do the Soybean Bulls Know?

For several weeks now, I have been saying the most bearish thing for corn is soybeans, and the most bullish thing for soybeans is corn. Afterall, with soybean stocks projected at nearly 1.0 billion bushels and record stocks to use, how could somebody even get bullish soybeans?

(chart in full article link below)

After reviewing the chart above, one almost has to think that soybeans will ultimately go lower. Just look at prices back in the early/mid 2000s. But I listened to one of my favorite analysts over the weekend and he made an interesting comment. To paraphrase, his thoughts were simple. The market does not believe in a legitimate 2018/19 ending stock of nearly 1.0 billion bushels.

As a numbers guy, this comment made me pause. How could the USDA be so far off? In past years, they have been notorious for underestimating demand that has ultimately led to much lower US ending stocks versus the initial estimate that comes out in May.

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