Soybean bulls are disappointed by rumors that most major roads in Brazil are now cleared as police crack down more heavily on trucker protests. Obviously, if the truckers start to protest once again organize or create blockages in transportation, the trade will become nervous and add necessary risk premium. At this moment that doesn't appear to be the case and, as suspected, this uncertainty appears as if it shall soon pass.
There is also some disappointment among the bulls as export inspections here at home continue to drop. U.S. soy exports are starting to more drastically fall out of favor and lose ground to South American exporters. From what I'm hearing, the Brazilian soybean harvest is now about 30% complete, which is about 10% behind last years pace, but not all that far behind their traditional pace.
There is also some talk among the bears that overall Chinese soy demand might be a bit overstated. I'm not sure I'm in total agreement, but it's being more heavily discussed.
From a technical standpoint the market also looks as if it may be in jeopardy of building a more bearish formation. Bottomline: If political unrest is resolved in Brazil and the soybeans start moving more aggressively to the ports and if Chinese demand stays strong, old-crop prices could be subject to 50¢ or more of almost immediate downside pressure. Keep in mind these are big IFs, but certainly must be acknowledged. I continue to like the thought of eliminating all remaining old-crop soybean risk on the rallies. With 40% already priced, I am staying patient in regard to new-crop.