28 October 2020
- Supply on the spot (2 weeks running window) continues to exhibit signs of increase. This is likely down to reduction of inventory which temporarily increase supply on the spot market. Having said this, our overall assessment is for tightness in the forward supply, which is best described by the proprietary Forward Supply Index.
- Our spot demand view remains bullish. As discussed before, the prospects for demand appear supportive only in the short-term as the data continues to suggest that weakness is forming for early November.
- As suggested in our previous publication, the macroeconomic environment remains supportive of the soybean price mainly thanks to strong economic recovery in Asia. Early indicators for November point in the same direction. This surge in demand continues to be driven by stronger credit creation and stronger credit velocity.