With the current market, some Brazilian farmers are defaulting on forward sales and selling the same beans in the spot market. By not delivering the beans, these farmers are penalized. However, soybean stocks are so low the farmers can make more money by paying the fine and selling the soybeans in the cash market. A group representing major trading houses is asking the courts for permission to seize the soybeans they’ve purchased from farmers. At this point, this firm has gone to court less than 20 times, but harvest is just beginning.
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