We don't normally repeat headlines on stories, but last week's works just fine for this week's review. USDA had more bad news for soybeans on Friday, and Wall Street weakness added to the problems.
The government's survey procedures continue to lose credibility after another shocking production surprise. On Sept. 30, of course, USDA said the size of the 2007 crop was actually 91 million bushels more than previously announced. Better late, than never, I guess.
USDA compounded the problem on Friday with a dramatic increase in acreage for 2008, adding 2.2 million more to total plantings. That allowed production to increase, despite a slight reduction in yield, and added to the woes of the complex. New crop carryout swelled way more than expected, to 220 million bushels.My own forecast is not quite that bearish for 2008, in part because USDA typically underestimates demand early in the season. Next year, however, could be another matter. With farmers uncertain about planting corn and other high-cost crops, beans could be the fallback. To read Bryce Knorr's complete weekly soybean review, click HERE.