Before rains swept through much of the Corn Belt last week, there were many people comparing the soil moisture to that of 2012.
Some might think that news could be enough to move the markets, but coming from the large money perspective, Brian Splitt, market analyst with Allendale, Inc., said the market is concerned with crop conditions at this point.
“The fund believes that we’re pricing in maybe a 178 to 180 bushel per acre corn right now because things in their eyes look really good,” he said on U.S. Farm Report.
Negativity about the markets doesn’t appear to be a big selling point to farmers.
“If you want to sell subscriptions, Debbie Downer is not going to make you successful,” Tommy Grisafi, risk management broker with Advance Trading, Inc.“You want to be optimistic—you want to give the farmer hope.”
Optimism and reality are totally different. Looking at the charts, corn has put in a double top, which is 10 months in the making, according to Splitt. The next 30 to 45 days will be “extremely important” to watch in terms of the weather.
“$4.30 is going to be a strong resistance level, and I’m not going to say that we can’t take that out at some point, but we have to have some kind of a bigger picture story and some real reason to think that we are losing yield instead of adding yield,” he said.
For Grisafi, that $4.30 level could change with “one or two tweets.”
“You laugh, but that’s the world we live in,” he said to a snickering Splitt.
Hear why Grisafi thinks the quality of hybrids are underestimated, and what Splitt believes will move price on U.S. Farm Report above.