Commodity Market Prices: Soybeans January 2012

 

It was a volatile month for soybeans, and after bouncing around, soybean futures closed at $12.0075  a bushel vs.  the $12.2750 they started trading on Jan 3rd.  Soybean’s volatility was largely attributed to  weather.  South America was dealing with drought conditions, this month, which caused soybean prices to rally on the fear that crops would be damaged. While the drought added upside pressure, a few rainfall events during the month caused soybean features to slump.  Soybean  futures were also sensitive to economic developments this month, with soybean futures rising to a two-week high after the Fed announced that they would keep interest rates low through 2014, a year longer than expected. The low interest rates sparked sentiment that demand for commodities will climb.

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