Good Morning!
I hope all is well in and around your operation this week. For ours, we are catching a shower here on Wednesday afternoon…so we’re hopeful it will have some substance. I know rains have been far from widespread, so I hate to even bring it up. Several of you have reached out indicating how bad you need a rain…I sure hope you get one. There is no question this is a critical time for weather, so the only good thing that could possibly happen if it stays dry overall is the markets will likely respond. Around home, our kids have no games still…and the latest topic of discussion is how school is going to manifest itself this year. I don’t know about you, but our kids are not at all excited about wearing a mask this school year. What a time we’re living in…it really is a crazy situation all the way around. Please stay in touch…we’d love to know who is getting some rain but more importantly all the areas that aren’t getting the rain. matt@agmarket.net
The corn market looked like it was going to continue its lackluster performance on the overnight and day session. While the bean market wasn’t following along, corn rallied during the day session and settled higher on the day. While some pop-up storms continue to help a few remote areas in the corn-belt, no wide-spread rain was occurring. Additionally, the forecast for the next week to two weeks is certainly still quite ominous. We have a report on Friday…most look for a blasé report with no major adjustments. Outside markets were supportive as August crude oil settled up 28 cents at $40.90. This was 18 cents off the high and 60 off the low in a quiet trading session. The DOW was up 199 points at 25,969. The Dollar continued its lackluster performance of late, setting off down .47, closing at 96.37.
Corn – The corn market hasn’t been that exciting since closing poorly last Thursday. However, we saw some life heading into the close on Wednesday as September corn closed 2 ¾ cents higher at $3.46 ¼. This was a half-penny off the high and 7 ¼ cents off the low of the day. The EIA report from the Department of Energy was up again…this time for the tenth week in a row at 91.6 million bushels of corn usage. This was over 39 mb off the marketing-year low. The corn market is completely at the mercy of the weather forecasts for the time being. Yes, we have the chance for a rally…but at the same time, we must look at these rallies as a chance to take some risk off the table. I wouldn’t sell bushels without knowing what production looks like…but we can always hedge or buy puts to place a floor under the market. My farm is going to move ahead with another 10% of fall sales at $3.65 and if we get that fill, we’re selling another 20% at $3.80. Yes I want to have some calls in place so we can participate in a rally IF this weather is super problematic. But…ignoring such a large rally could be something a person really regrets. Please reach out if you need help with your marketing plan. Having it buttoned down now is more important than ever.
Soybeans – Soybeans weren’t performing quite as good as the corn market on Wednesday. August beans settled 4 ¼ cents lower at $8.92 ½. The close was 4 ¼ cents off the high and 2 ½ off the low of the day. The bean market, in my opinion, has more upside potential than the corn market possesses. With beans being an August crop, the weather will be important for 4-6 weeks whereas we’ll know most of what we need to know with regards to the corn market in the next couple of weeks. Also with the bean market, we definitely have a tighter situation than we do with corn. The supply and demand balance sheet likely stays the same or even tightens up this week due to the bean export program staying solid the last several weeks. For sales on beans, we sold another five percent last week basis the Nov at $9. IF we can rally to $9.25, I’d like to sell another 10%. In all honesty, I could see this bean market rallying substantially with any weather issues…and it sure appears we’re building a story for one right now.
Call us if you want to talk positions or strategy…or simply bend our ear. If you want more information on the markets, be sure to visit my team’s website at https://www.agmarket.net/
Matt Bennett
217-273-1133 – Work
@chief321 – Twitter
matt@bennettconsulting.net – E-mail
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