Hot Temps in August Rally Soybean Prices

The month of August could not have started any better for U.S. soybean farmers with cooler-than-average temperatures and a wide coverage of rain showers. Unfortunately, the next seven-to-10 days is forecasted to be uncomfortably warm and short on moisture for the Great Plains and a large swath of the Midwest. Soybeans are made in August and the second half could be a low-scoring defensive battle. November soybean futures rallied 46 cents for the week by Friday morning to reach $13.54 per bushel in anticipation of the warm weather. Traders will be watching the market open closely come Sunday evening to catch the last gasps of weather volatility trade for the year, before the last of the unknown yield potentials become known at harvest.

Stocks Retreat

Inflation has cooled, and interest rate hikes are projected to stall out sooner rather than later with hopes that a recession can be avoided, but both the Dow Jones and S&P 500 were down over percent this week by Friday morning. This week’s downturn follows what had been a sizable rally in the stock market through the summer months, so it is not all doom and gloom. The lower week could be as simple as a seasonal pullback, but there was another round of troubling economic news from China this week in what has become a reoccurring theme. Among the latest batch of economic data out of China was a report that property investment had fallen for a 17th-consecutive month, and that China had suspended publishing youth jobless data after it hit a record high of 21.3 percent in June.

The world economic ties that bind have become more fragmented post-Covid, but Chinese troubles will not occur in a vacuum either and investors can’t be made to believe that a tree falling in the forest does not make a sound, even if no one is allowed to report it.

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