USDA report

[flapjack]

Interesting numbers As one yanke put it this morning, he knows he has to live with these numbers but now he knows were all the enron accountants are working.

[rain]

Have a look at the soybean oil numbers. Bean crush is lowered by 2.6%. Meal production was lowered 2%. Bean oil Production was only lowered .6%.

[Kasro]

Can anyone figure out what the outcome of the US loan program on beans will be?

USDA says the soybean carry-out will be 190 million bushels. As I understand it, there is now about 300 million bushels in the loan program, and likely more going in daily because of the low cash price relative to the loan price.

Question: To get down to 190 million bushels, a lot of soybeans will have to come out of the loan. Commercials will have to bid it out as I understand. Will this action not raise the price? Won't they be buying futures to cover anticipated future needs, and consequently move futures higher?

And for a second question: If the huge South American soybean crop is largely sold by harvest time, as is usually the case, when the futures are bought back (commercials buying futures back when beans are exported) won't this give the market a bit of an upward bias?

Now put these 2 things together.........

Is there hope out there??!!??

[Kasro]

Another question. Take a look at this chart.

http://www.softwarenorth.net/cot/current/charts/C.png

It is a picture of the commitment of traders positions. It shows that for the first time since July, commercials are now long corn futures. Funds are short for the last 2-3 weeks only.

Is something changing? What price implicatios does this have?

[TOM4CWB]

Kasro;

Watch the Futures issue, I understand exchange of positions for export delivery is not bought back, but simply redeemed.

However for the Brazilian Beans, if they are hedged in the US, then this becomes a question...

Maybe Chaffmiester can help?

Do you know Charlie?