Tidbits
Computer selling completely got out of hand yesterday. It all started because the market continues to expect the largest ever soybean crop in Brazil, which is the same expectation every year for the last 50+ years. Beans eventually pulled corn lower and then corn pulled wheat lower. The economic problems in Brazil, Congress may not be able to get a bill passed to keep the government running into the new year, and uncertainty about the biofuel guidelines also added to the frustration yesterday.
Brazil’s currency, the Real, continues to decline to record lows against the dollar. The Central Bank of Brazil has been raising interest rates to support the Real. Expectations are that interest rates will be increased another 1% or more next month. Brazil’s government has spent twice as much money in 2024 than in 2012. The Real has dropped from 60% of the value of a U.S. dollar to below 16% since 2012 and its value is falling like rock. The Real to the dollar lost 22% in 2024!
January beans gained another half cent on March beans yesterday. There is 1½¢ of carry from January to March.