wmeubank@ocp.kcmo.com
IRA EPSTEIN & COMPANY
223 West Jackson, 7th Floor, Chicago, Illinois
(October 28, 1997) SOYBEANS: I believe January 98 soybeans have possibly put in a top at approximately 720. If I'm right this could keep downside pressure on prices over the next several months. With this year's harvest projected at a near-record level of 2.72 billion bushels and an indication of superior production coming out of South America, soybean supplies seem to be more than adequate to satisfy current demand.
The only equation that could change my opinion is the current shortage of rail cars used to get beans from harvest to market. Additionally, overseas exports appear sluggish and would need improvement for me to change my opinion. Exports to Asian markets could see a sharp decline due to the Asian monetary crisis which continues to play havoc on the world's stock markets and international monetary exchange.
My recommendation is to now go short January 98 beans with a stop loss at 715. Beans are currently trading January basis at 704½ as I write this report.
Rick Schultz
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