Made of multiple factors, Soybean rebound to continue
After New Year's Day holiday, the domestic agricultural products continue to follow the higher pre-holiday rally, once again, of which the highest Soybean main contract in May rose to 3523 points, compared with December 31, 2008 closing price of 3382 points, up 141 points. Although the Wednesday session of domestic Soybean showed spikes in the delay and drop the disk, but due to geopolitical tensions between the Middle East and the South American soybean producing countries and the needs of the country's drought continued strong demand is expected to rebound will be supported.
As confidence suffered no financial crisis, panic atmosphere of the market, had led to sharp appreciation of the factors in soybean prices rapidly a 180 degree reversal on soybean prices pose a serious blow. Example, the original energy has been rising energy crops such as soybeans strong support, the current price has dropped from 147 U.S. dollars, the lowest close to 30 dollars. Can imagine such a substantial drop of the factors on the beans market in the crackdown. At the same time oil prices have made agricultural production costs significantly reduced. In addition, the financial crisis led to large capital fund controlled by the shrinkage of lost enthusiasm for speculation. In the full-blown financial crisis, the international and domestic all goods are involved significant downturn, a drop of more than 50% of basic. One soybean international market dropped from more than 1654 cents, the minimum break of 800 cents to reach 776.2 cents, the domestic point fell to 2850 from 5241 or thereabouts. In less than a year's time, there is such a rare drop sharply, of course, thanks to the whole world's financial crisis.
Now even though time had entered in 2009, but as investors in July 2008 since the sharp decline in global commodity prices should be remembered, of which there is a certain fear factor. Factors in the panic price under selling pressure emerging under, will show a fall over, and then usher in oversold rally. Present in agricultural products from the market by the end of 2008 demonstrated the trend is on the market rebound down the amendment reflects panic. At the same time coupled with geopolitical tensions and trigger a quick rebound in international oil prices, and the main soybean producing areas of the climate brought a boost for this rebound effect. Since the tension in Gaza since the start of international oil prices rebound, the current rate of nearly 50% of the rally. Although most analysts believe that the war does not change the current global financial crisis caused by the economic downturn, but investors can not take it lightly as to be proper precautionary measures. Historically, the Middle East geopolitical impact on oil prices has always been very important, as the Iran-Iraq War, Gulf War triggered the first two oil crises, oil prices rose more than 300%. Who can guarantee that this would not have so much impact?
The financial crisis, declining influence, the product itself became a fundamental factor in controlling its price trend factors. In the global market environment, the international protein demand and to encourage South American crops, traders worried about potential cuts to increase the risk premium. Brazil and Argentina are the world behind the United States after the second and third of the soybean producer. South American soybean crop is suffering from drought and the threat of weather, crop yields in South America is expected to decline. According to private analyst Informa1 6-day forecast by the Brazilian soybean production forecasts. South American production cut will lead to increased demand for U.S. supplies, made even more intense level of carry-over stocks. Which made the continuation of the global soybean rally.
Comprehensive view, due to excessive down soybean prices rally after the ushering in retaliatory, while oil prices were exacerbated by the current international situation is also tense up support for its composition, while the international market demand for soybeans and South America is still the main producing areas suffering from drought and climate threats to increase its rising momentum. Therefore, investors should fully understand the current situation grasp the rally.
I am an expert from China Toys Suppliers, usually analyzes all kind of industries situation, such as refrigerator door magnet , magnetic powders.
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