A Glimpse Into The Future (Maybe)

Posted by Nogger - a legend in his own mind at 15:22 | Categorized as

07/02/13 -- Have you ever been on a train and gone to the buffet car and been stung into paying a fiver for a (microwaved) bacon butty and a (crap) cup of tea? Even though you know that a bacon butty and a cup of tea isn't worth a fiver. You could buy a much better one at the cafe near the station for half that. Except you're on the train, not in the street near the station. If you want a bacon butty and a cup of tea now it's a fiver, take it or leave it. If you want to wait until you get to your destination, or get off the train at the next stop and rummage around for ten minutes to find yourself a nice cafe where they do a lovely fresh bacon butty and a proper cup of tea, then you can save yourself a few quid. But if you want a cup of tea and a bacon butty now then it's a fiver. Now. Thanks, help yourself to sugar...

Well, Septic Peg, my spirit guide from beyond the grave, has been on the blower (yes, it's been a while, she's had the painters in) with her two penneth on the soya market which she says is very much like the scenario above and one which I thought I'd share with you.

US soybean export sales are showing no sign of letting up, in fact they are accelerating. They've shipped more than a million tonnes a week for a record 19 weeks on the trot now (the previous record was 11).

Ships are already backing up in Brazil and yet they're only just scratching the surface with the harvest. Things can only get worse, much worse.

Various commentators in this report are signalling sharply higher prices in the months ahead:

US Soy Supply at 48-Year Low as Brazil Ships Held

As pointed out there, if China wants beans next month it doesn't matter how big the crops are in Brazil and Argentina if they can't physically get them onto the market.

I see potentially record breaking nearby tightness in the physical markets for soybeans/soy products in the months ahead, regardless of what the futures market says. Physical kit that you can get your hands on is likely to be extremely difficult to source and the premiums you will have to pay to get it (if indeed you can get it at all) could be unprecedented in their magnitude.

And all this is occurring before the the Brazilian/Argy farmers/truckers/dockers start thinking what a golden, God-given opportunity to strike and get our demands met once and for all by the govt/employers this is.