A.G. EDWARDS & SONS, INC.
One North Jefferson, St. Louis, Missouri
314-955-3050(March 9, 2000) SOYBEANS: Weather in South America is still an issue for the soybean market, but is also having more of a mixed effect. Soybean harvesting is progressing in northern and central Brazil, albeit with some delays on account of frequent rain showers. Meanwhile, good rains over the past month have bolstered production prospects in the other growing regions of Brazil and Argentina.
The harvest delays have kept the window of opportunity for U.S. soybean exports open longer than usual. U.S. soybean exports got a tremendous boost from a Chinese buying spree in late February, presumably because of Brazilian shipping delays. Unlike last year when the devaluation of the Brazilian real encouraged heavy forward sales of Brazilian soybeans, the marketing pace appears to be more subdued this year. We expect Brazilian producers will hold on to a portion of their crop in case of a weather problem in the Midwest. The question, assuming better crop prospects in general for South America, is whether this will be enough to act as a buffer should serious weather problems emerge in the U.S.?
As far as the next several weeks are concerned, we believe the key for the corn and soybean markets will be whether spring rains can replenish depleted soil moisture levels enough to ensure good planting conditions.
Dean Nosker
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