Technical analysis will never give you the why behind the move. That is where fundamental analysis comes in. While I don’t know for certain if the reason below is what may propel soybean prices higher it’s surely food for thought at the very least.
In the past few months or so a potential freighting series of events has taken place which has received very little “main stream” coverage.
However, the BBC did run publish a good piece on the subject recently. Additionally, Eric Bolling “The Admiral” a NYMEX floor trader and regular commentator on CNBC has also touched upon the subject from the early get go. So on that note, I’m assuming that most of you are already aware of the story. However, I wanted to share some thoughts on the matter either way.
So what exactly am I taking about? Honey Bees and the large amounts that are disappearing from the managed environment ran by professional beekeepers.
Personally, I never really gave much thought in the past to how much we rely on magnificent creatures. From the production of honey to pollination of crops their contribution to mankind in the area of agriculture is rather staggering to put it mildly when you start to look beneath the surface.
How staggering?
Since many of our pollinators are now scarce, we are more dependent than every before on the honey bee to pollinate our crops. Pollination starts when a field bee crawls around a plant blossom. The honey bee is dusted with pollen. Then the field bee flies over to another blossom with the pollen in its hair. When the bee lands, the pollen falls onto this blossom’s stigma. Now a fruit, vegetable or other crop can grow.
Some farmers rent colonies of bees from keepers to pollinate their crops. Two species of honey bee, A. mellifera and A. cerana, are often maintained, fed, and transported by beekeepers. Although other insects pollinate crops, honey bees are one of the few that are synchronized and managed with the development of crops. If honey bees didn’t pollinate, crops wouldn’t be able to grow. Without the pollination from honey bees it is estimated that there would be 33-50% less crops in the world! Even on the lower end of spectrum that’s a significant amount.
There are many agents of pollination other than honey bees. Pines and some other trees, grasses, and some weeds are pollinated by wind. However, many wind pollinated entities such as maple, hickory, corn, and ragweed are visited by bees collecting pollen.
Insects other than bees visit flowers and serve as pollinating agents, as well. Wasps, flies, various types of beetles, and other earthly insects work flowers for pollen and/or nectar which assist in the pollination of those flowers. Typically they are of little value to crop growth. Of all the types of bees, honeybees have several advantages as pollinators.
Bees from a honey bee colony will visit a great number of plants over a very large area, collecting pollen and nectar, with individual bees visiting one species of flowers in the same location until the supply of nectar or pollen is completely exhausted. This pollination trait is not found in other types of social bees, which visit various plant species during the same trip in the fields. This behavioral trait of other classifications of bees reduces their effectiveness as a pollinator because the pollens are mixed.
Recently large amounts of honey bees have been disappearing and the situation is propagating into something that could potentially become a very serious threat to the global food supply.
To elaborate on the subject further please read:
Penn State University College of Agriculture Sciences : Honey Bee Die-Off Alarms Beekeepers, Crop Growers and Researchers
Cosmos Magazine: Mystery of the Dying Bees
Uncensored Article: Could Genetically Crops be Killing Bees
BBC Article – Vanishing Bees Threaten U.S. Crops
“Since October 2006, 35 per cent or more of the United States’ population of the Western honey bee (Apis mellifera) – billions of individual bees – simply flew from their hive homes and disappeared.”
Bees literally fly away and don’t return home. Sounds like something from the X-files. Are they being poisoned by some type of mysterious agent? Are the internal compasses of these creatures not working properly? Whereby, driving them into starvation since they can’t find their way back to the colony hive. If so, what entity could potentially be affecting their sense of direction?
So far much of the speculation that I have read as to the reason why honey bees are dying off has revolved around genetically modified crops, mercury contamination as well as pesticides.
While I have done a considerable amount of research into the matter, although I’m a derivatives trader and not a scientist, I have yet to come across much in the area of solar activity and honey bees.
Considering that honey bees utilize the sun for direction and solar cycle 24 is forecasted to be one of the most intense since record keeping began, http://science.nasa.gov/headlines/y2006/21dec_cycle24.htm, I had to ponder this question even though solar activity never stops not even during solar minimums. The problem is that we are “near” the start of this new cycle and won’t know the official beginning until after the fact as any type of cyclical work utilities approximations.
Additionally, some of this thought on the sun would have to consider other solar cycles as well. This would then lead into the area of looking at the evidence of the “global warming is cyclical camp, as opposed to those that subscribe to the notion that humans are the cause, and not just cyclical here on earth but throughout the solar system. While I personally subscribe to the cyclical warming camp I have to ponder if both groups may be correct simultaneously.
Take some of the recent data on Mars for example. http://news.nationalgeographic.com/news/2007/02/070228-mars-warming.html
Is the same cycle which may be potentially warming Mars and/or Earth also affecting the sense of direction of honey bees? Could the problems be caused by more than one issue?
For example, according to recent data solar activity hasn’t increased dramatically yet. But if we take into consideration the Mars data it’s possible that the same reasons causing Mars to warm in conjunction with only small increases in solar activity could alter the internal compass of the honey bee. If so, what will happen when the cycle reaches its maximum in 2011 – 2012? Is the current situation only the beginning?
Solar flares are often associated with coronal mass ejections, the ejections of electrons, protons and ions from the Sun. These charged particles have some other effects on Earth. The Earth has a natural protection against these charged particles: its magnetic field and atmosphere that blocks most of them. However, some charged particles can enter the atmosphere at the poles and impact subjects not protected under earth’s atmospheric blanket.
For example, we only need to look so far as the auroras to witness the beautiful effects of solar flare activity. When charged particles, especially electrons, find their way at the poles, they get accelerated along the lines of the magnetic field and collide with the particles in the atmosphere which makes them glow. That glow is what we see as an aurora.
Effects / Possible Effects of Solar Flares:
* Damage and outright destruction to satellites. For example, a 1994 solar storm caused major malfunctions to two communications satellites, disrupting newspaper, network television and nationwide radio service throughout Canada.
* Emerging research has shown a possible correlation between pandemic outbreaks and increased solar activity.
* Earth’s Climate and warming ocean temperatures. For those in the U.S. any possible significant increase in ocean temperate could generate a very high possibility that an F5 hurricane will strike the Galveston, TX area potentially wiping out over half of the oil refining capacity. And that that’s not including any massive impact on the corn crop creating higher ethanol prices! Scientists are warning for a busy hurricane season in 2007 due to the record-breaking warmth. “We’ve never seen this before,” said Scott Glenn, a professor of marine science at Rutgers University’s Institute of Marine and Coastal Sciences, referring to the warm winter waters in a recent interview on the subject.
* Underwater earthquake activity, potency and frequency.
* Possible increased erosion in pipelines.
* Radio signals which causes a disruption in wireless communication.
* Electrical Transmission Lines. For utility operators, any power interruptions caused by solar storms creates pressure on the remaining power grid. Although utilities and owners of large transformers have more sophisticated advance warning tools than at any other time in history to help them prepare and prevent loss it’s not perfect.
A somewhat recent example, in March 1989, a solar storm much less intense than the perfect space storm of 1859 caused the Hydro-Quebec power grid to go down for over nine hours, and the resulting damages and loss in revenue were estimated to be in the hundreds of millions of dollars! Additionally, in some cases even with advanced warning it can be difficult to take evasive action.
For example, in the summer of 1859 there was a massive cloud of magnetically charged plasma called a coronal mass ejection. Not all coronal mass ejections head toward Earth. For ejections that do head for earth the typically time arrival time is around three to four days. However, the one in 1859 took approximately 17 hours to arrive!
* Health issues for airline pilots and astronauts. The magnetic field and the atmosphere block out most of the harmful radiation and charged particles. However, this is not the case when you go up in the atmosphere. Airline pilots that fly at great altitude, and especially near the poles, are exposed to more of these. The same goes for astronauts. This results in a higher incidence of cancer among airline pilots and cabin crew.
Because of this airlines need to alter flight paths. Increased operation cost what results.
I would have to think that at some other point in time in history we would have witnessed effects on bees “directional sensitivity” from solar flare activity. Maybe we have and did not realize it. How far back in history do we have data on honey bees? For example, new research has demonstrated a possible correlation between solar flare activity and pandemic outbreaks. But the jury is still out on this one in regards to something conclusive.
Any possible past effect on honey bees, or any other animal for that matter, by flare and other solar activity would also have to take into account the frequency and potency measurements. Also, as is the case for bees, do they utilize the sun in any direct or non-direct way to dictate direction?
Honey bees use the sun as a reference point in navigation and communication. Experiments have shown that bees have an internal representation of the sun’s movement through the sky. The bee can, therefore, use the sun as a fixed point and orient itself by maintaining a fixed angle between its line of flight and the line to the sun. While this trait is a natural instinct past research data suggest that this feature of bees is somewhat tailored by experience.
However, the sun plays an even greater role in aspect of food gathering. The dance language, which bees use to communicate with each other, is also based on the location of the sun. When bees return from a food source, they perform a “waggle dance” on the vertical comb nearest the entrance to the colony hive.
The dancing bee makes a short, straight run while waggling its abdomen, then circles back and repeats this action several times. At this point the bee structures its dance so that the angle between the direction of the straight run and the ray opposite gravity is the same as the angle between the food source and the position of the sun. In this instance, dancing straight up means “fly toward the sun,’’ straight down translates into “fly away from the sun.” Given this angle, other bees can then position themselves to the sun and locate the specific food source.
In the late 80s, Wolfgang H. Kirchner and William F. Towne proved the above with a robot honeybee. It had razor blades for wings, and tiny computer-controlled motors allowing it to copy the dance. It could sing the song with its razor blade wings, and execute the dance via its electric motors.
Real honeybees would ignore their robot razor blade honeybee, if it just performed the dance, or just executed the song. But when it did both, the real honeybee would obey the robot bee. The scientists could actually communicate to the rest of the colony. At this point the scientists had the ability to control the robot honeybee in a manner that would drive other bees out of the nest in any direction they wanted.
Is the reason that honey bees aren’t returning to their nest the same culprit for the mysterious deaths of birds across the world? Are the internal compasses of bees, birds and potentially other animals being thrown off kilter due to some unforeseen force affecting the sun?
Thousand of Birds Fall From Sky Over Australian Town
Just a day or so before the Australia incident birds in Austin, TX fell from the sky.
Is this somehow related to the why the White House has tightened publishing rules for USGS Scientists.”>White House has tightened publishing rules for USGS Scientists?
If anything is for certain it’s that that volatility in the marketplace is here to stay with us well into the future. While I’m sure someone will ask me about American being the world’s bread basket and the possible impact on the U.S. Dollar I decided to leave that topic open for discussion for some other time.
On a final note, are group is in the final stages of forming a new subsidiary that will deal wholly in risk management solutions for commercial entities. Additionally, we have put together an agreement with a large institution that will provide commercial financing solutions, contingent upon meeting specific requirements, for those who need to utilize various risk management products to protect their financial interests.
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Hoping All Your Speculations Are Profitable,
Paul Skarp, Principal Aaron Trading
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