The bears continue to argue that the USDA is going to revise the size of last year's soybean crop, perhaps by some 20-40 million bushels. Thoughts are this will obviously help offset any additional demand adjustments higher for booth the crush and soybean exports. In addition, the argument is still holding water that more soybean acres have been planted than the USDA currently has estimated (81.5 million). Many sources think 82-83 million acres will go in the ground – surpassing last years crop by about 5 million acres and perhaps 3-4 million more acres than the current 2010 record of 78.9 million acres.
Keep in mind the largest "harvested" soybean acreage estimate for the end of June USDA acreage report was also in 2010 at 78.0 million acres. In other words, the trade is fearful that a massive crop could be coming down the pipe. From a "spread" perspective, I continue to hear talk form many traders who suspect the old-crop/new-crop spread (now at it's lowest level since mid-Feb) will continue to deteriorate – at least through the June 30th report. From there it's believed we could see a late inning rally and perhaps one last hurrah!