Soybean prices forecast chart and comparison with Palm Oil prices
Actually, I found it very difficult to lock onto the Soybean Signal and had been struggling with it since early December 2012. As a result I went back to look at how soybean prices and palm oil prices had behaved over the last 30 years. The data I used was supplied by MetaStock. From the soybean prices and palm oil prices comparison chart above you will notice that soybean and palm oil price trends are very similar for most years. There are exceptional years when they don't appear to behave similarly. One such period was during 1994 to 1999. This may have been due to the Asian Financial Crisis of 1998 where the Malaysian Ringgit was hit by speculators and devalued from RM2.75 to US$1 to RM4.20 to US$1. That would make palm oil export prices climb in terms of Ringgit Malaysia (RM).
The lowest point for soybean prices
The lowest point for soybean prices was during 1999 to 2002 period as shown in my chart above.
Soybean prices hit a sideways bottom between 1999 to 2002 without a clear direction. This could have been due to speculative community shifting funds to fuel the Internet Bubble. From the chart above, someone could have called the Internet Bubble as early as August 1999. Of course, I dare say that hind sight is always 2020.
After 2002, soybean prices began to move again. Soybean prices have been moving upward from about $500, between 2002 and 2006 to a base level of $900 after 2007. I see a further general upward climb in soybean prices in 2013.
Soybean prices forecast for 2013 2014 2015 2016
I had a tough time trying to predict the soybean prices trend movement as I had struggled to lock onto the soybean signal. In the end I went back to my first soybean prices chart and am publishing that chart. As you can observe from my soybean prices forecast that I am expecting the price to jump to $2000 after March 2013. This jump in soybean prices, if no one intervenes, will most likely occur between May 2013 and September 2013, after which soybean prices will drop to a more realistic level.
What you should not do
Back in early 2010, the Malaysia government, based upon my charts, attempted to push up the price of rubber. I freely gave my charts to the Prime Minister at the request of a personal friend of the prime minister. The rubber prices shot up and as a result many people invested in rubber companies and rubber plantations. They did not realise that the underlying movement was temporary and some invested heavily. The prices have since corrected to a more stable price range which is reflective of natural demand. As a result all those who rushed into the temporary rubbery gold strike are paying the price.
Please don't rush in to plant more soybean or invest in soybean funds or soybean industries, as this may be a temporary spike in prices which is not sustainable. If you do many of you may get burnt and never recover.
Look at investing somewhere else where prices are dropping or realistically moderate.
Limited knowledge on soya bean
I must warn you that I have minimal knowledge of soya bean and the soya bean industry and I do not keep track of the soya bean news. Really, it can be quite tiresome to track commodity news, which, most of the time, is of dubious value. All my research has be purely based upon the historical soybean prices data. I prefer palm oil to soya bean oil due to its neural flavour and longer shelf life but my mom uses quite a bit of soya bean as she is almost vegetarian - that is the limit of my knowledge of soybean.
What should the speculators do?
Actually, since I am not happy with this price forecast, I would suggest that speculators do take a wait and see approach. If I have the time, I will try to re-do this chart sometime between March and June 2013. It was much easier to do my Palm Oil prices forecast then this Soybean prices forecast and hence I am more confident of the Palm Oil prices forecast. If you have been paying too much attention to Gold prices I would suggest that you consider Brent Crude and even Soya Bean as a counter to speculate in. I have not looked at Gold and Rubber seriously and will have to look at them by the end of this month as there may be something interesting there.
At the end of the day, I cannot tell you how to trade or what counter to trade on. All I can do is show you what my theory shows provided that I have done the analysis correctly. This is the case with soybean prices as projecting the soybean prices movement into the future was quite difficult.
Tell the farmers
Do let the farmers know about the 2013 price rally so that they can earn more profits and plough it back into the Real Economy. Commodity traders won't plough the profits into the Real Economy as they will put it into more speculation to get rich faster.
This article soybean prices forecast chart 2013 2014 2015 2016 was researched and written by Peter Achutha, 20th January 2013
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