The following commentary does not necessarily reflect the views of AgWeb or Farm Journal Media. The opinions expressed below are the author's own.
Kevin Van Trump has over 20 years of experience in the grain and livestock industry.
Corn bulls are talking about good global demand for US corn (strongest weekly export sales since March), but this data continues to be trumped by the thought of expanding global supplies. Remember, not only are we looking at what could be a record US crop, but the USDA is also forecasting the highest global supply level we have seen in the past 15-years. I keep hearing talk from the bulls who continue to reference a couple of years back, when the USDA estimated the US corn crop in August at a record 165 bushel yield, but we watched this yield estimate fall to just under 153 bushels per acre on more extreme heat hitting the crop through late-summer. On the flip side the bears are worried that the USDA is falling further "behind-the-curve" in regard to bumping yields higher... sounds very similar to what stock market bears are saying about Yellen and the Fed in regard to interest rates (everybody is falling "behind-the-curve"). Corn, at least for the interim, seems to have found some balance, nearby chart support seems to be in the $3.70 to $3.75 range, but the longer-term "tech bears" continue to talk about the $3.10 range... I suspect the trade will pause for a bit and wait for more direction and clues in regard to the Black Sea conflict. Once the green flag is waived and the track is cleared for more high-speed racing, I suspect we resume our downward descent. Producers should continue to use any and all rallies as a way to reduce additional exposure and risk. CLICK HERE for my daily report....
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