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The
GCA Insider is a free weekly report courtesy of
Kevin Kerr's Global Commodities Alert service.
Every Thursday the report delves deep into a
specific futures market to provide readers keen
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tick. It is our sincere hope that these
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An
Insider's View of
Soybeans
Among
the five sacred plants of ancient China,
soybeans have expanded well beyond their
original land of cultivation and now reign as
the second most valuable crop in the United
States. As a food product, soybeans have been
alternately lauded for their potential health
benefits and regarded with suspicion as to
potential hazards. Overall, soybeans have a fair
share of interest - as well as controversy - but
are undeniably an important part of farming in
both hemispheres.
Contract Size - 5,000 Bushels
Price Quote & Tick Size - Cents per
bushel; minimum fluctuation is ? cent per bushel
($12.50 per contract)
Contract Months - January, March, May,
July, September, November
Trading Specs - Trades open outcry and
Globex (electronic) per the following schedule:
Electronic: 6:00 p.m. - 6:00 a.m. and
9:30 a.m. - 1:15 p.m. Central Time, Sun.-Fri.
Open Auction: 9:30 a.m. - 1:15 p.m.
Central Time, Mon-Fri.
Daily Price Limit
$0.70 per bushel expandable to $1.05 and then to
$1.60 when the market closes at limit bid or
limit offer. There shall be no price limits on
the current month contract on or after the
second business day preceding the first day of
the delivery month.
Trading Symbols - Open Outcry - S;
Electronic - ZS
***chart
courtesy of Gecko
Software
Soybean Facts
Soybeans have been cultivated for food and other
uses for nearly five millennia. Originally
native to eastern Asia, the modern farming areas
for this oilseed occur on nearly every
continent. In the United States they were
originally considered an industrial product and
after their initial introduction to North
America they were grown for hay. It was only
during the twentieth century that America began
to use soybeans as a food product. Noteworthy
global distribution of production, imports, and
exports is as illustrated in the following
table:
|
Attribute
|
Country
|
'00/'01
|
'01/'02
|
'02/'03
|
'03/'04
|
'04/'05
|
'05/'06
|
'06/'07
|
'07/'08
|
'08/'09
|
|
Production
|
United States
|
8,355
|
8,572
|
8,360
|
7,748
|
8,782
|
9,248
|
9,294
|
9,329
|
8,713
|
|
(In 1000 MT)
|
China
|
3,240
|
3,575
|
4,730
|
4,535
|
5,421
|
6,149
|
6,410
|
7,045
|
7,405
|
|
|
Argentina
|
3,190
|
3,876
|
4,394
|
4,729
|
5,128
|
5,998
|
6,424
|
6,627
|
6,811
|
|
|
Brazil
|
4,333
|
4,700
|
5,205
|
5,588
|
5,630
|
5,430
|
5,970
|
6,110
|
6,040
|
|
|
EU-27
|
2,984
|
3,198
|
2,950
|
2,531
|
2,575
|
2,460
|
2,640
|
2,667
|
2,456
|
|
|
India
|
814
|
833
|
615
|
996
|
900
|
1,070
|
1,180
|
1,426
|
1,490
|
|
|
Mexico
|
760
|
787
|
740
|
663
|
635
|
657
|
685
|
650
|
645
|
|
|
Japan
|
675
|
695
|
770
|
645
|
579
|
515
|
534
|
528
|
519
|
|
|
Taiwan
|
361
|
370
|
365
|
360
|
355
|
385
|
380
|
339
|
365
|
|
|
Paraguay
|
165
|
213
|
287
|
177
|
176
|
219
|
279
|
290
|
279
|
|
|
Thailand
|
246
|
284
|
318
|
249
|
267
|
253
|
250
|
269
|
249
|
|
|
Canada
|
295
|
295
|
312
|
278
|
275
|
281
|
278
|
265
|
274
|
|
MY Imports
|
China
|
355
|
551
|
1,712
|
2,728
|
1,728
|
1,516
|
2,404
|
2,727
|
2,370
|
|
(In 1000 MT)
|
EU-27
|
29
|
62
|
29
|
57
|
181
|
717
|
977
|
1,033
|
620
|
|
|
India
|
1,400
|
1,479
|
1,197
|
906
|
2,026
|
1,727
|
1,403
|
733
|
650
|
|
|
Iran
|
729
|
835
|
959
|
735
|
741
|
600
|
606
|
545
|
670
|
|
|
Egypt
|
366
|
341
|
268
|
188
|
173
|
242
|
124
|
480
|
250
|
|
|
Morocco
|
311
|
303
|
367
|
328
|
318
|
372
|
360
|
420
|
425
|
|
|
Venezuela
|
197
|
214
|
201
|
302
|
247
|
285
|
351
|
370
|
380
|
|
|
Algeria
|
17
|
24
|
90
|
20
|
299
|
293
|
271
|
350
|
325
|
|
|
Bangladesh
|
503
|
406
|
383
|
332
|
228
|
262
|
327
|
347
|
367
|
|
|
Peru
|
198
|
238
|
221
|
230
|
263
|
302
|
300
|
305
|
310
|
|
|
Korea
|
166
|
189
|
157
|
211
|
244
|
265
|
302
|
296
|
310
|
|
|
South Africa
|
131
|
106
|
137
|
220
|
235
|
235
|
290
|
290
|
280
|
|
|
Canada
|
22
|
80
|
124
|
99
|
76
|
79
|
79
|
80
|
82
|
|
|
Brazil
|
69
|
146
|
85
|
26
|
3
|
28
|
4
|
67
|
50
|
|
|
Japan
|
3
|
2
|
12
|
24
|
45
|
61
|
50
|
42
|
45
|
|
|
United States
|
33
|
21
|
21
|
139
|
12
|
16
|
17
|
30
|
23
|
|
|
Turkey
|
118
|
232
|
122
|
79
|
136
|
267
|
20
|
28
|
45
|
|
|
Panama
|
16
|
17
|
18
|
20
|
15
|
20
|
22
|
28
|
30
|
|
|
Nicaragua
|
19
|
14
|
23
|
21
|
33
|
35
|
27
|
27
|
29
|
|
|
Lebanon
|
40
|
33
|
14
|
14
|
17
|
21
|
13
|
27
|
28
|
|
MY Exports
|
Argentina
|
3,080
|
3,630
|
3,920
|
4,238
|
4,757
|
5,597
|
5,970
|
5,766
|
5,650
|
|
(In 1000 MT)
|
Brazil
|
1,533
|
1,775
|
2,394
|
2,718
|
2,414
|
2,466
|
2,462
|
2,388
|
2,140
|
|
|
United States
|
636
|
1,143
|
1,027
|
425
|
600
|
523
|
851
|
1,319
|
794
|
|
|
EU-27
|
889
|
892
|
711
|
556
|
525
|
269
|
243
|
333
|
250
|
|
|
Paraguay
|
135
|
157
|
199
|
251
|
112
|
195
|
258
|
262
|
255
|
|
|
Bolivia
|
124
|
167
|
192
|
192
|
238
|
244
|
230
|
150
|
145
|
|
|
China
|
53
|
59
|
13
|
15
|
40
|
105
|
94
|
102
|
70
|
|
|
Malaysia
|
180
|
150
|
85
|
68
|
104
|
89
|
90
|
88
|
80
|
|
|
Iran
|
180
|
138
|
265
|
102
|
90
|
75
|
85
|
80
|
75
|
|
|
Norway
|
22
|
28
|
30
|
51
|
68
|
81
|
73
|
60
|
65
|
|
|
UAE
|
28
|
15
|
18
|
35
|
40
|
47
|
50
|
50
|
50
|
|
|
Canada
|
38
|
34
|
21
|
17
|
9
|
23
|
24
|
50
|
25
|
|
|
India
|
19
|
4
|
5
|
5
|
11
|
13
|
10
|
10
|
10
|
|
|
Russia
|
3
|
3
|
3
|
1
|
0
|
1
|
5
|
10
|
10
|
|
|
Australia
|
3
|
2
|
2
|
0
|
0
|
1
|
1
|
1
|
1
|
|
|
Mexico
|
5
|
4
|
11
|
4
|
2
|
1
|
0
|
0
|
0
|
|
|
Venezuela
|
8
|
18
|
6
|
0
|
0
|
0
|
0
|
0
|
0
|
***table
data courtesy of USDA/NASS
Since soybeans are produced in large quantities
in both the northern and southern hemispheres,
crop news and weather is relevant nearly all
year. Cultivation is most successful in climates
with hot summers and plenty of sunshine - up to
and over 14 hours per day - can be important to
the flowering stage of a soybean plant. The
complete sowing to harvesting cycle for the
modern soybean varieties can take anywhere from
80 to 120 days. Soybeans come in a variety of
colors from black and brown to gray and yellow.
Most commercial soybeans in the United States
are of the yellow variety.
Key Uses
Oil - Soybeans undergo a process to
extract oil destined for a variety of processed
foods and commercial products.
Livestock Feed - Soybeans are rich in
proteins and the meal left over from oil
production is used as livestock feed for
everything from chickens and hogs to catfish.
Human Food - From infant formula to tofu,
the number of products in supermarkets that
contain soy have grown in recent years. Soy
milk, soy yogurt, soy crisps, toasted soy nuts,
and even immature pods that we refer to as
edamame are a part of many modern diets.
Industrial and Commercial Products -
Soybeans are a part of some surprising everyday
items. From plastics to solvents, soybeans are
even used to produce cloth. The idea of using
agricultural products in industry is not as new
as we think it is with Ford being a notable
early pioneer in non-food applications of
soybeans. Soybean derivatives were added to
plastic parts in Ford vehicles. As recently as
last summer, the Ford Company was suggesting
that soybeans can be used for producing parts
for cars, namely car seats. Henry Ford is also
credited with suggesting that an alternative to
gas was needed.
Fuel - Biodiesel from soybean oil has
been used for many years now and the recent
increased fervor to produce alternative fuels
may yield additional research for both new and
used soybean oil.
Key Concerns
Weather - As with most field crops,
soybeans have sensitivities to light,
temperature, and moisture. When planting,
soybeans perform best when soil has warmed to 50
degrees Fahrenheit or better since they are
susceptible to frost damage. Early planting in
cool, wet soils reduces the likelihood of
germination and increases risks of disease.
During the full maturity stage, anywhere from
five to ten days of dry weather are required to
reduce moisture levels in the soybeans to less
than 15 percent. Long storage periods will mean
less moisture is desirable in beans to prevent
mold and spoilage issues.
Genetic Modification - With the advent of
biotechnology and the ability of scientists to
adjust and modify plants for particular traits
comes controversy over the impact on
biodiversity. Roundup Ready crops allow
farmers to sow seeds directly and possibly
reducing soil erosion with no-till farming;
however, there are theories that breeding the
gene directly into many soybean cultivars may
reduce genetic diversity, which can open up a
whole host of problems - including disease
resistance. Many countries do not allow GM
crops, which causes export issues; especially
when no GM stocks are cross contaminated with GM
crops.
Disease and Pests - Again, as with most
field crops, soybeans can play host to any
number of plant and bean devastating molds or
pests. Some diseases may destroy parts of the
plant while others threaten the soybeans
directly. Of the most widely recognized issues,
a few are listed below:
Phytophthora Root Rot: Spread by spores
from infected plants in soil and occurs most
frequently in areas of clay soils and in flooded
soils. Kills roots.
Soybean Cyst Nematode: A microscopic
roundworm that infects soybeans roots and causes
significant loss in soils where it is abundant -
as much as 20 bushels an acre can be lost in a
dry year and in sandy soils.
Septoria Brown Spot: A common leaf
disease that can lead to up to fifteen percent
yield losses. This fungus spreads in warm, humid
weather.
Asiatic Soybean Rust: This is one you may
hear often in the news as it is one of the
diseases for which commercial soybean varieties
lack resistance at this time. Infected plants
can produce smaller yields and smaller beans.
With many pests and diseases, fungicides, crop
rotation and early identification and proactive
response can control and reduce risks to the
crop.
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