Jerry Gulke says the grain markets are holding their breath, waiting to see where and how much rain falls this weekend.
The weather radar tops the list of factors influencing the markets this week. Many areas of the Midwest are feeling pretty parched and could use a nice, slow rain.
Jerry Gulke, president of the Gulke Group, says many weather sources are predicting a cold front coming out of Canada to bring rain to just about everybody. That has definitely caught traders’ attentions.
Hear Gulke's full audio analysis:
USDA's Joint Ag Weather Facility says the ongoing heat wave across the Midwest and Northeast will soon end in the wake of a cold front’s passage. The cold front will also spark widespread rainfall (locally 1 to 3 inches or more) across the eastern one-third of the U.S., and result in severe thunderstorms on July 19-20 from the Midwest into the Northeast.
Meanwhile, an active monsoon circulation will produce widespread, drought-easing showers from the Southwest to the central Plains. In contrast, mostly dry weather will accompany building heat from the Pacific Coast to the northern High Plains.
The NWS 6- to 10-day outlook for July 24-28 calls for above-normal temperatures in most areas west of the Mississippi River, while cooler-than-normal conditions will prevail across southern Florida and from the Great Lakes region into the Northeast. Meanwhile, above-normal rainfall in the Southwest and the eastern one-third of the U.S. will contrast with drier-than-normal weather across the southern Plains and the Northwest.
Gulke says this forecast should make for some interesting markets come next week. "We won’t know for sure until Sunday night, when the markets open again, how much rain we did get. We’ll find out if it was a bust or not. We’re going to be a lot smarter come Monday morning."
Current USDA crop condition ratings show the majority of the corn and soybean crops are healthy. Here are the estimates, as of July 14.
- Excellent: 17%
- Good: 49%
- Fair: 25%
- Poor: 6%
- Very poor: 3%
- Excellent: 13%
- Good: 52%
- Fair: 27%
- Poor: 6%
- Very poor: 2%