Analyst: “Take advantage of decent prices today”

IARN — Soybean futures saw “another good run” on Wednesday.

Wednesday marked the eleventh straight day of upward trends in soybean futures, according to Jim McCormick, branch manager of Ag Market. He adds, “We are technically getting overbought,” but encourages folks to look at the carry.

“The market is telling you not to store beans into next summer. They need beans between now and January to fill demand for China. After that, there is no demand,” McCormick says.

Ag Market encourages producers to “take advantage of this.”

“Market grain off the combine; don’t pay for commercial storage,” McCormick says. “If you want to play the ‘what if,’ and I think there is a ‘what if,’ consider using an options strategy in July. You’re not paying a lot of carry. Take advantage of the decent prices today and then use options to re-own for the ‘what if’ scenario.”

McCormick suggests making sales ahead of the September World Agricultural Supply and Demand Estimates (WASDE) report, scheduled for release on Friday.

“The burden at hand (is) we don’t know what the government’s going to say on the WASDE report,” McCormick says. “A lot of people are looking for the crop to get lower. But we might set ourselves up for a little ‘buy the rumor, sell the fact,’ as USDA tends to walk the yields down from report-to-report.”

Story courtesy of the Iowa Agribusiness Radio Network.