Wednesday, 16 November 2011

Speculating with Soya in the stock market

The drop in the soya prices and another raw material is bringing Latin America to the global crisis.
The Latin American countries have been dealing well with the global financial crisis and have been growing at very good rates, some of them around 6 %. Thanks to  previous learned lessons in the past decade and how they readjusted the economic and financial system and also because most of them have now a strong link with China and the rest of Asia, eager of the raw material and food of the Latin American countries.
But now the prices of the raw materials (copper and even gold) and also the soya (one of the main products of the Latin American economies) has been falling for a while. Everyone can think it is because the raw materials use to vary time to time their prices (offer and demand), but never before 15-20 raw material have been rising and falling all together. The reason can be because the slow recovery of USA and the European crisis has put in a halt the Chinese growth. But no, the main reason again is for those how manage the money and the market. Like in the 90s they speculate with the technology bubble and more recently with the state market they have been speculating with the raw material market for a while, and we know now very well what happen when everyone is speculating in the same market.
Actually the soya price is U$ 437, when the last august was in a record price of U$ 534.  The soya export have a high tax retention in some of the countries (Argentina 34%) and if they start to lose those millions of dollars, the Latin America grow and investment will put on halt in a moment where the global market is in total chaos.


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