The weather in South America is the front-and-center topic for the current market movements, says Jerry Gulke, president of the Gulke Group.
Overall, corn and soybean prices have started to mellow out, as more time passes from the market-jolting Jan. 11 USDA reports.
"The January USDA reports are out of the way now," says Jerry Gulke, president of the Gulke Group. "So, the question is what kind of crop will we get out of South America?"
Gulke believes overall, the crop will be large out of South America. He says while some areas may have had some weather challenges, overall favorable rain has been improving forecasts for corn and soybeans in Brazil and Argentina.
So, will these corn and bean crops make it to the countries that need them? Will they prove competitive against U.S. grain?
"What we’re gathering is the chips are starting to line up for these beans that are coming out of Brazil because they are cheaper. But the waiting time could be as much as 45 days to load a ship. That may cause some buyers to buy beans from the U.S. instead."
Gulke says if that happens, it could provide one last rally in beans.
In the meantime, Gulke says they will continue to watch daily reports out of South America and be ready for any knee-jerk reactions to any news coming out of there.
Listen to Gulke's full analysis:
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