Soybeans, like corn, are developing quickly and are in good shape, leading the market to expect USDA will raise estimated 2020/21 yield in the August WASDE report. In July, USDA put new-crop soybean yield at 49.8 bushels per acre, based on the department’s weather-adjusted trend model, but U.S. soybeans hit higher yield numbers in 2016/17 at 51.9 bpa and at 50.6 bpa in 2018/19. The industry overwhelmingly expects USDA to raise 2020/21 soybean yield to over 51.0 bpa, increasing anticipated production to over 4.23 billion bushels—perhaps as high as 4.32 billion if yield hits 52 bpa and acreage remains at 83.8 million acres.
With expectations of a larger crop, Nov-20 soybean futures are quickly retreating from July’s rally that took the contract back to $9.00. Although the market rejected values over $9.00, a comfort zone in the high $8.00s held for most of the month before the market turned sharply lower last week: Beginning Aug. 4, the November contract settled lower each session, losing over 28 cents in four days.
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