I have not been blogging for a while (trading was still on-going for me though). Hence, I would like to write a timeline of what happened for the past few weeks.
On 9th Nov 2012 (Friday), USDA made its November Crop Production and World Agricultural Supply and Demand Estimate reports available. Soybean production increased to 2.97 billion bushels (4% more than the October estimate) and soybean yields are predicted to be around 39.3 bushels per acre (1.5 bushels per acre more than October’s estimate). This meant that the soybean price was going down.
I pulled out of my short positions on soybeans on 12th November 2012. The price for the November 2012 contract was $14.04 while I bought it at $14.735. Hence, I made a profit of (14.735-14.04)*5000=$3475. In addition, the price of the January 2012 contract was $13.87 and the price decrease was decreased from $14.57. Thus, the gain was $3500. The gains on each contract was the highest I made since the start of the trading game and my only regret was that I could have short more contracts than just merely the two.
On 16th Nov 2012 (end of that week), it was concluded that the price for soybean plunged the most by 68 cents per bushel (Jan 2013 contract). Factors contributing to this decrease include the rush to sell off long positions before the expiry date for the November 2012 contract, the good weather forecast in South American, which implies that the competitor’s prices are lower, and the call of US soybean export to China due to the low crush margins as predicted by China processors.
http://www.agweb.com/article/ag_commodities_trade_lower_as_uncertainty_looms/