Corn Market Turns Attention to Ohio

June 3, 2011 10:00 AM
 

This information is provided by Archer Financial Services, Inc. 800-933-3996.

 

The corn market this week was quite mixed as old crop values closed almost a nickel lower, while new crop corn scratched out a slightly higher close for the week. Meanwhile, soybeans and wheat worked in opposite directions with July soybeans trading over $.30 higher for the week and July wheat settling down $.46 for the week.

The week started on Tuesday that Russia announced plans to re-enter the world wheat export market beginning on July 1. This started the break to wheat, but it was enhanced by improving wheat crop conditions in Europe. July wheat appears to have solid support near $7.40.

The attention in the corn market centered on the debate as to how many acres will be lost from the USDA’s March 31 estimate of 92.2 million acres. This acreage talk will continue until the USDA releases its updated estimate in 27 days. The planting pace to be released on Monday will show that the corn crop will be nearing 100% completed on a national basis, but all eyes will be on Ohio as to how aggressive they were last week in "mudding" their corn crop in the ground.

The market showed strength at mid-week, perhaps on beginning-of-month fund buying as well as the market incentivizing farmers to plant the last of their corn crop rather than choosing the prevent plant option. With this buying having run its course and with the USDA likely to report an improvement of nearly 4% in good to excellent crop ratings on Monday, one should look for a seasonal decline in crop values into the middle of the month.

The USDA will update its balance sheets next Thursday, but the real fireworks will surround the Stocks and Acreage Report to be released later this month. It is important to plan ahead in your marketing, so that the high volatility does not induce mistakes in your hedge program.

 

 

 

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