Soybeans sure feel rejuvenated after the holiday break.
Abundant demand and tight supplies are leading to +$13 prices, not seen since 2014. A trifecta of drivers are leading to the tightest demand-supply split in over six years:
On the flip side: While row crop farmers bask in the price opportunity, livestock producers are cringing. It’s the double edged sword of agriculture inputs.
CoBank projects that 2021 will bring 12% higher feed costs for the animal protein sector. In the summer alone, cost inflation is expected to reach 18% for hog producers, cattle feeders, and chicken growers.
Bottom line: The industry has its eyes on January 12 for the next WASDE report. Expectations of increased U.S. soy exports and lower South American production means this soybean surge won’t slow anytime soon.