While many traders aren’t putting too much weight in a global stockpile rush, corn growers should be prepared, says Jim Bower of Bower Trading.
"Part of the reason why I haven’t been too aggressive at selling new-crop position this year is, I think behind the scenes, a lot of these major buyers are actually trying to put themselves in a position to stockpile inventories because of the hangover loss that they had from last year," Bower tells U.S. Farm Report host Al Pell during the weekly Market Roundtable discussion. "So again, I think the critical time this year is still ahead of us, and I think that critical time this year, particularly in the Corn Belt, will be from about July 23 through about Aug. 13 when the corn crop tassels and pollinates over a wide area. I think we’re heading into a relatively interesting and volatile timeframe for ag."
While that might be true, it's important to consider another key crop as well, says Bill Biedermann of Allendale, Inc.
"I think that the corn is going to be pretty volatile, but what about the beans?" Biedermann says. "I mean, the carryover is going to be increased pretty well hands down with the acreage."
Bower agrees, assuming yields are good, but he points to water-damaged crops in states such as Wisconsin as a persistent concern.
View the videos below for a complete analysis of this issue, as well as discussion about the market’s reaction to recent comments by Federal Reserve Chairman Ben Bernanke, a lull in U.S. consumer beef demand and continued imports of feed from countries such as Argentina.
Watch Segment 1 of USFR’s Market Roundtable:
Watch Segment 2 of USFR’s Market Roundtable: