Soybeans Near $12 Per Bushel As US Farmers Celebrate Surging Prices Tyler Durden Wed, 11/18/2020 - 05:45 Soybean futures sold for around $11.69 per bushel on the Chicago Board of Trade yesterday, breaching a four-year high earlier this month. By comparison, CBoT soybean futures were trading around $9.40 per bushel when the U.S.-China Phase 1 trade deal was signed in mid-January. Moe Agostino, the chief commodity strategist with Farms.com Risk Management, said, "no one in the US thought we could even get to $10/BU, and now here we are (almost at $12/bu)." Agostino said bullish price action had been the result of two factors: increased trade and weather events. "It started with better-than-expected demand, particularly from China as they bought soybeans because they needed them as part of the Phase 1 trade deal," he said. Farms.com's Diego Flammini said China, to date, had purchased a total of $23.6 billion in US farm products, or about 71% of its agriculture commitments specified in the trade deal. Soybean prices hold near $12 per bushel, which was also driven by adverse weather (storms and drought) in both the US and South America. This month, Brazil suspended tariffs on soybean imports from outside the country to ensure its domestic supplies were stable following strong demand. Agostino said if South America doesn't receive adequate growing weather, it could mean prices move even higher. "Many in the trade see $12, but I think we are going to see $13 futures," he said. "It could happen by the end of the year. If South America gets less-than-ideal moisture in the next month or so, it could happen very quickly." Reuters notes many Brazilian farmers sold their crops before CBoT soybean futures began to rise. A clear indication US farmers have turned hefty profits this year, capitalizing on elevated crop prices and exports to China. "For once it was the right thing ... Usually the best opportunities to sell for fall are March through June but the world came to an end in March," said Norway Center, South Dakota, farmer Jed Olbertson, referring to the sharp decline of commodity prices as the COVID-19 pandemic hit the western hemisphere. Brazilian farmers told Reuters they missed the rally and sold too earlier, however, their growing season is opposite to North America. "I am one of the most regretful farmers," said Cayron Giacomelli, a grower in Brazil's top grain state Mato Grosso. "Nobody imagined, even in the best-case scenario, that we would have prices above 120 reais per bag for future delivery at this time of the year." Rising crop prices and increasing demand from China is great news for struggling US farmers who've seen their incomes decimated over the last decade.