The soybean market opted to shrug off Tuesday’s negative USDA report, opening the door for soybean prices to rally off of their recent lows, says Jerry Gulke, president of the Gulke Group.
“We had a good week in the soybeans, and today [Friday, Sept. 15] was a day when we dropped back 7 cents, but you could expect that since we were up 15 cents the day before and up good the day before that,” Gulke tells “Weekend Market Report” guest host Jo Windmann in an interview airing Saturday, Sept. 16, 2017. “Quite a recovery. I guess I would look at those lows around $9 that we posted in August. A lot of people thought those were the pre-harvest lows and maybe the low for this marketing year—that’s a little bit of a stretch, perhaps, depending on the South American crop. But we are around $9.68.
If the market had closed over $9.78, it would have represented a weekly key reversal higher, Gulke points out.
“Where it is now, we had a reversal in grain prices to close higher in soybeans on a report that had negative connotations. In other words, it wasn’t so much what they said as what they didn’t say,” Gulke says. “They didn’t lower the yield, yet there’s so many people out there yet that still don’t believe that crop is that good in soybeans or corn, for that matter. That may be part of it. The market’s sometimes a self-fulfilling prophecy. If they don’t want to sell more, then the least path of resistance is higher. We’re not into harvest yet, we’re just beginning, and that will expand more.”
Meanwhile, the good news on the soybean front “helped corn maintain itself,” he adds.