Here’s the Market Volatility We Lacked in 2017

June 20, 2018 12:38 PM

Commodity markets are still struggling after Friday’s news of China placing tariffs on U.S. agricultural products. As a result of the news, soybean prices have dipped to nearly 10-year lows.

“The ag economy is actually in the crosshairs on most of those discussions,” said Brian Roach, president of Roach Ag Marketing, Ltd. “I think there’ll be some sort of high-level negotiation…the Chinese need out beans.”

When this news broke on Friday, Joe Vaclavik, president of Standard Grain, said this situation has the appearance of a “buy the rumor, sell the fact scenario.” 

With the combination of “extreme selling” and trade rumors with China, Craig VanDyke, risk management specialist with Top Third Ag Marketing, said the current story in the market has been developing over the last six to eight months.

“We were at a record low volatility period in the grain market,” he said on U.S. Farm Report. “When you’re coming off record low volatility, you’re going to have a lot of volatility coming out of that period.”

Hear what Roach and VanDyke said are the fundamental components of this situation on U.S. Farm Report above.

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