Soybeans are up 9 cents in overnight trade

[rain]

Dollar aside why is it guys like you alway say look at the beans look at the beans. Soyoil is the driving factor not soybeans. The US could be setting up to be a very big importer of vegoil this year. Soybeans to my knowledge are grown for the meal and oil is a byproduct. Canola is grown for the the oil and the meal is a byproduct. Maybe you where with the grain company to long.

[rain]

Week seven Canadian Canola export 406.9 Forecast is 464.38. Canadian Canola
Domestic Use 378.3, forecast 385.0.

Exports are off 14%, Domestic use is off 2%. You are right we are behind the pace needed to drop stocks but not so far that we can not make up the difference.

% can be deceiveing especially early in the season.

Don't Cha Think?

[rain]

A) I can tell you that i was with a grain company long enough to know that grain companies don't care if the price of canola is $5.00 or if the price is $10.00. They work on MARGINS.

B)Look at the beans - look at the beans. Brazil is on target to grow 60 MMT of soybeans - enough beans to fill 1000 concrete elevators the size of NWT in Unity or Agpro in Brandon or enough railcars that it would a train 14,973 MILES long.

This year even if the US has an absolute wreck in their bean crop, they will still grow 68 MMT.

Thats what canola OIL is competing with.

This year Brazil and Argentina may surpass last year's US bean production by 10 MMT.

This isn't 1971, 1976, 1983 or even 2002. The dynamics of the vegetable oil industry have changed. Do you think ADM is closing soybean crush plants in the US and moving to South America and China because margins are better in the US?

Guys like me say look at the beans because it is reality. An extra 10 MMT of soybeans means an additional 4 MMT of soyoil. Last time I checked, no one was out looking at the soyoil in the field to see if it was flowering

[rain]

Yes u r right it is too early to compare % after 7 weeks

[timm]

larry, look at the oil world web site and you will see argentina & brazil are getting dry.if you spend a little time on a combine you should know what that does.

[charliep]

CBT soybeans touched $7/bu this am.

A note that there are areas in South America but this is still very early. seeding is just getting started in Brazil and still at least a month away in Argentina. Seeding in south America starts in late October and carries right through to January (double cropped areas). South America is also a big and diverse region so you really need to be aware of where the dry conditions are.

A couple of notes from a conference. Dry conditions are having an impact on Argentine wheat. This will have to be watched. As well, dry conditions will are also reducing corn acreage (seeded earlier) and potentially resulting in more soybeans.

A final comment on canola. Have your target prices and be prepared to act when they are achieved. This may mean first half 2004 delivery period.