BALTIMORE -- Looking for the next under-priced natural resource? Commodities guru Kevin Kerr says soybeans could be 2007's next great agricultural trade.
Kerr, the editor of Resource Trader Alert, forecasts soybean prices "could double" this year.
"Increasing pressure on ethanol-producing corn industries could easily put enough strain on soybean acreage to drive prices up," he explained.
With soybeans being the second largest agricultural commodity in the U.S. and the main ingredient in many of the country's cooking oils and animal feed, any change in soybean supply is likely to alter its trading value.
In a recent edition of Kerr's commodities newsletter, he wrote, "Bean buyers have already started amassing contracts. If farmers opt to grow corn for the obvious, immediate ethanol profits, soybean production will drop and prices could soar."
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He added that according to recent surveys, U.S. farmers have already begun to sow the smallest soybean crop since 1996.
Soybean farming is a $16.9 billion industry.
Soybeans, corn and wheat all reached three-week highs in Chicago last week on expectations that pension funds and other investors will spend more on agricultural commodities in 2007. Kerr opined this might just be the start of a long run for soybeans.
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