From wet weather, to hail and even frost, the U.S. corn crop in the Eastern Corn Belt has been hammered this year. The first taste of USDA corn crop conditions ratings this week started to reveal that story, yet, the corn market doesn’t seem to want to budge. However, the potential for a summer rally is still there.
“Use the carry folks,” said John Payne, Daniels Ag Marketing. “If you have storage on farm, stop looking at that from month price of corn and start looking at what you're going to market in March, May and beyond next year.”
Payne says it’s the new crop contracts really showing value, with even the potential for prices at $4.40.
“You might have an opportunity here if we get a little bit of a push in the front month in May and July upwards of $4.30 to $4.40,” said Payne.
Jim McCormick of Allendale, Inc. says in a year like this with so many unknowns, a game plan is key.
“I do think we're going to get a nice rally this summer if the weather plays tend to come in,” he said. “But when it does, it's going to come hard and fast, so we're recommending guys make that decision now. Have your orders ready to work in the cash market, as well as the futures markets, and when it hits profitable levels, be ready to make those sales.”