AgriTalk: “Be a Slave to Price Action”

May 7, 2018 08:53 PM

That was the message Craig VanDyke from Top Third Ag Marketing hammered home on today’s AgriTalk After the Bell hosted by Chip Flory. VanDyke explained that price action at this time of the year must be watched closely and growers should be ready to respond to longer-term pricing signals from daily charts and basis changes.

“Setting targets is fine and farmers should be doing that, but you also need to respect what the markets are telling you on a day like today with prices off sharply. New-crop beans have lost about 40 cents in just two trading days, but we’ve still got November beans close to $10.20. That’s not a terrible price and it’s better than we expected for new-crop beans not that long ago,” explained VanDyke.

In the cattle market, VanDyke says he’s having a difficult time justifying June live cattle futures trading at a roughly $20 discount to the cash market. He told Flory, “I just don’t see the cash market breaking down like that over the next 3 weeks… and that makes futures feel underpriced.”

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