That was the lowest ending stocks since the 1976 crop year, according to the U.S. Department of Agriculture. That is significantly higher than a year earlier due to the highest soybean planting in 15 years. But demand appears ready to soak up supply. How and when soybeans are distributed will shape upcoming market rallies, says Anne Frick, oil seeds analyst with Prudential Securities in New York. If they hold onto beans, we're going to be bullish in the short term.
Some analysts say many international buyers postponed spring bean purchases to the new crop.
Depending on the strength of U.S. exports in coming months, beans could see a significant rally. Early season USDA reports indicated that several Central American countries will be big year-end buyers of U.S. soybean meal. China also is expected to a major importer of soybeans and oils. Much of the pricing, however, depends on bean crops in Brazil and Argentina. Both countries are expected to increase their corn and soybean acreage this year.