Soybean Economic Value

Cash soybeans (Central Ill.) appear to have potential for a spring rally.  The accompanying scatter studies display the highs and lows for cash soybeans as a function of a model forecast. The model uses the US soybean carryout and soybean oil exports and soy oil used as fuel to forecast the winter spring soybeans price range. Note there is significant upside potential  assuming the February USDA soybean supply/usage estimates.

A larger than expected South American soybean crop and disappointing soybean sales to China are major hazards to long soybean positions.

Note 2020 (red point) is set to the model forecast and the current price of $9.00