1. As I mentioned in my blog last week, now the price of soybean is mainly impacted by world’s demand. Recently there is news about Chinese increasing demand toward soybean, so I boldly predicted there will be a slight short-term increase in soybean’s price.

“China’s soybean imports are likely to touch a record high of 57.5 million metric tons in 2012, up 9.3 percent year-on-year, due to the country’s booming demand and shrinking domestic output. China’s soybean growing area fell 13.8 percent from the previous year to 5.79 million hectares in 2012, marking five consecutive years of decline, according to data from the Ministry of Agriculture. The ministry forecast that yields will likely decrease 5.3 percent year-on-year to 1,693.5. kilos per hectare because of a summer drought, causing the country’s total soybean output to a three-year low of 9.8 million tons. ” (News from Beijing http://usa.chinadaily.com.cn/business/2012-10/29/content_15853350.htm )

Falling domestic output suggested that China is becoming more dependent on the global market.

According to the latest report from the US Department of Agriculture, China’s soybean imports will rise to nearly 61 million tons next year, up 3 million tons from 2012.

2. Although I hold an optimistic view toward soybeans future market, I’ll still be very cautious. The hurricane’s impact on the agriculture and the coming harvest of South American soybeans also deserves attention.