Currency became the chief driver of grain prices this week. That’s likely to continue into the foreseeable future, says Chip Nellinger, Blue Reef Agri-Marketing.
“This whole week was about currency,” Nellinger tells “Market Rally” host Chip Flory in the episode that aired Thursday, May 18, 2017. “It really didn’t have anything to do, in my opinion, with the weather, with planting progress, with production potential.”
Among currency activities this week:
- U.S. Dollar Index moved to a six-month low early in the week
- Brazil’s real strengthened early in the week, leading to a soybean rally; then it weakened tremendously amid a breaking political scandal
“Really [currency] could be something that drives us going forward more so than production,” says Nellinger, though he adds “obviously, yield and final yields are going to be the big driver of this.”
Listen to the complete conversation with Nellinger on Market Rally.