Apparently, most of China’s recent purchases on the commodity markets have been to build up stockpiles, rather than satisfy actual demand – according to The Daily Crux.
That means the huge Chinese buying is unlikely to continue, and that in turn means commodity prices may be unable to sustain their recent advance.
As for the stockpiling, at least 90 freighters stuffed with iron ore that are floating at China’s ports will have to wait as much as two weeks to unload their cargo because port storage facilities are full…
If this is the case…we sure could be in for a violent pullback in the near term.
Personally, I sold all of my soybean positions today – I was too scared to stay long, and I’m also too frightened to go short. So for now I’ll bide time in cash – US dollars of all things!
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